Operator Wants Interest-Free Fund for MFBs

Managing Director, Money  Wise Microfinance Bank, Mr Dele Oyekanmi on Tuesday urged the Federal Government to introduce interest-free intervention fund to assist micro finance sub-sector.

Oyekanmi told newsmen in Lagos that beneficiaries of such intervention fund should repay the loans after five years.

He said that the gesture would make funds available to the micro finance sub-sector and also encourage more persons to patronise the banks.

‘In Bangladesh, the government gives micro finance operators interest-free loans for five years. Before the five years repayable period, beneficiaries would have increased their capital-base with the money they borrowed.

We need that kind of funding in Nigeria and such intervention will allow us, micro finance operators, to give out loans to Nigerians at a very low interest rate. Again, it will also boost customers’ confidence in the sub-sector, he said.

Oyekanmi, who is also the chairman, Ikeja Branch of National Association of Microfinance Banks (NAMB), blamed low capitalisation for the high lending rates of microfinance banks.

Oyekanmi said that it was unimaginable for any microfinance bank to give loans at a rate that would incur loss to it.