Business
Microfinance Bank Opens Up On CBN’s Intervention Facility
A financial institution, the NIRSAL Microfinance Bank, has said the intervention facilities, given by the Central Bank of Nigeria (CBN) that helped to facilitate growth and bolster the economy were loans, and not grants, stressing that such facilities must be repaid.
The Head, Corporate Communications of the NIRSAL Microfinance Bank, Halimatu Omar, who made the clarification in a statement, noted that the loans were tailored for diverse purposes.
“The loans provided at various intervals were strictly intervention loans tailored for diverse purposes determined by the CBN, including the Targeted Credit Facility (TCF), popularly known as the COVID-19 loan due to its timing, as an initiative aimed at mitigating the pandemic’s impact, sustain businesses, and bolster the economy”, she noted.
Omar acknowledged recent challenges in loan recovery, saying the bank has launched a proactive recovery campaign via its social media platforms.
According to the image maker, despite the one-year extension of the moratorium, many beneficiaries have still defaulted on payment schedules.
“Despite offering an additional year to the initial one-year moratorium, numerous borrowers have unfortunately defaulted on repayment schedules.
”Hence, heightened efforts are being made to remind them, through text messages, of the repercussions of default”, she said.
Addressing concerns raised in a recent publication, the bank urged beneficiaries to identify and report individuals who purportedly acted as “agents” of the bank to the appropriate authorities.
She warned that the bank might rely on the Global Standing Instruction (GSI) to recover the loans.
”It is imperative for beneficiaries to understand that the Global Standing Instruction (GSI) represents one legal recourse for the bank in loan recovery, as authorised by the CBN. This policy empowers banks to debit accounts in other banks to settle defaults.
“Beneficiaries with genuine concerns about repayment are encouraged to approach the bank for evaluation and further discussion regarding their loan status. The bank’s website hosts valuable information to facilitate smooth repayment of the loans.
“The most prudent action for beneficiaries is to honor their repayment commitments, as evasion is not a viable option.
The facility will be disbursed through participating Microfinance Institutions (MFIs), which will in turn extend the loans to their customers, particularly SMEs, as they directly interface with businesses at the grassroots level.
The Executive Director of COMCIN, Mr. Micheal Ogbaa who represented the Chairman, Dr. Iredele Oyedele (FCA, FCCA), said the initiative is designed to strengthen micro-lending institutions and expand access to finance for grassroots entrepreneurs, particularly women and youths in the informal sector.
Ogbaa explained that COMCIN does not lend directly to individuals but works through its network of microfinance and cooperative institutions, which in turn provide loans to end users.
“We came together to advocate for the microfinance ecosystem. Commercial banks often exclude people at the grassroots, but our members are positioned to reach them. This facility will empower them to do more,” he said.
He noted that the loan scheme offers low interest rates and flexible repayment plans, making it more accessible to small business owners.
According to him, about 90 percent of beneficiaries are expected to be women, who play a key role in sustaining families and driving economic activities at the local level.
“Our focus is on traders, service providers, and players in the informal sector. These are the real movers of the economy. By supporting them, we are strengthening families and contributing to national development,” he added.
Ogbaa disclosed that eligible SMEs with proven integrity and business track records could access up to N5 million each through participating micro-lending institutions. The rollout has commenced in Lagos and will extend to Abuja, Enugu, and other regions, including the South-West, South-East, and North-East.
He said 12 micro-lending institutions have already benefited from the scheme, while 85 applications are currently being processed under the pilot phase.
“Our target is to reach at least 100,000 SMEs nationwide. We are building a platform that connects funding partners with credible micro-lending institutions, creating a reliable channel for financial inclusion,” Ogbaa said.
He added that COMCIN is also working to attract larger funding pools from development finance institutions and private investors, noting that successful implementation of the pilot phase would boost confidence and unlock more capital for SMEs.
“We have seen encouraging testimonies from early beneficiaries. As we demonstrate transparency and efficiency, more institutions will be willing to channel funds through us,” he said.
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