The Senate has established an ad hoc committee to investigate the alleged uneven disbursement of a N483 billion loan to Medium and Small-Scale Enterprises (MSMEs) in the six geo-political zones by the Development Bank of Nigeria (DBN) in 2021. The motion to initiate the investigation was raised by Senator Mohammed Ali Ndume (APC, Borno) and co-sponsored by 64 other senators during Wednesday’s plenary session.
The seven-member committee, chaired by Dave Umahi, includes members such as Babangida Oseni, Ali Ndume, Banigo Ipalibo, Sani Musa, Chizoba Chukwu, and Adetokunbo Abiru. The committee has been tasked with reporting back to the plenary within four weeks.
The previous 9th Senate had already formed an ad-hoc panel to investigate claims that the South-West, particularly Lagos State, had the highest number of loan beneficiaries. During the investigation, DBN officials stated that they strictly followed the criteria set by their regulators and did not consider geopolitical factors when disbursing loans.
However, Senator Ndume expressed dissatisfaction with the outcome of the previous investigation and the committee’s recommendation. He argued that the Senate should reevaluate the issue due to the significant disparity in loan disbursement. According to the bank’s Annual Integrated Statutory Report for 2021, a total of N483 billion in loans was disbursed. Out of this amount, only 11 percent, equivalent to N53 billion, went to the 19 northern states, while Lagos alone received 47 percent, amounting to N227 billion.
Senator Ndume further highlighted the breakdown of loan disbursement based on the bank’s report. The South-West received the largest share with 57 percent, totaling N274.7 billion. The South-South accessed 17 percent (N81.9 billion), the North-Central and FCT received 11 percent (N53 billion), the South-East received nine percent (N43.3 billion), the North-West received five percent (N24 billion), and the North-East received a mere one percent (N4.8 billion).
Ndume also pointed out that the loan was allocated to five sectors: oil and gas (42 percent), manufacturing (16 per cent), agriculture, forestry, and fishery (7.2 percent), trade and commerce (6.3 per cent), and transportation and storage (3.5 percent).
According to Ndume, the purpose of the DBN is to address the financing constraints faced by MSMEs in Nigeria by providing finance, partial credit guarantees, and technical assistance to eligible financial intermediaries on a market-conforming and financially sustainable basis.
