Bisola David
There are growing concerns about the alleged delay in the disbursement of the N275 billion palliative loan promised to the country’s manufacturers and Micro, Small, and Medium-sized Enterprises.
The Punch reported that the fears were reportedly stoked by supervisory agencies’ lack of communication regarding the program’s status, a development that has stoked worries that the program may have cornered politicians and their allies in the administration.
While other palliatives are being distributed to the state government and other groups, the manufacturing sector has yet to benefit from the palliative, which is set to expire in six months (July 2024).
The development came four months after President Bola Tinubu promised to ease the hardships faced by businesses in a nationwide address.
The president stated in his speech that he was determined to strengthen the manufacturing sector, increase its capacity for expansion, and create well-paying jobs.
“We plan to spend N75 billion between July 2023 and March 2024. Our goal is to fund 75 enterprises with high potential to jump-start long-term economic growth, accelerate structural transformation, and boost productivity.
”Each of the 75 manufacturing enterprises will be able to access N1 billion in credit at 9% per year, with a maximum repayment period of 60 months for long-term loans and 12 months for working capital.
Tinubu added, “In the same way, we will fund 100,000 MSMEs and start-ups with N75 billion.” Each enterprise promoter will be able to obtain between N500,000 and N1 million under this scheme, with a repayment period of 36 months and an interest rate of 9% per annum.”
However, four months after the promise, prospective beneficiaries said in separate interviews that they were unaware of the reasons the funds had not been disbursed.
They also stated that they were aware of the program’s current status and the anticipated start date.
However, four months after the promise, prospective beneficiaries said in separate interviews that they were unaware of the reasons the funds had not been disbursed.
They also stated that they were aware of the program’s current status and the anticipated start date.
The President of the Association of Small Business Owners, Femi Egbesola, lamented the slow pace of data collection by supervising agencies on Friday, alleging that genuine businesses were being deliberately discouraged from accessing loans.
“Well, I’m not sure why it hasn’t been distributed,” he explained. We were all excited when the president announced during his national address about four months ago, thinking that help had arrived somehow, somewhere. We were extremely optimistic, right now, we have been disenfranchised because we have waited and there is no hope.”
“At the moment, businesses are closing down, leaving their owners without a source of income. This is a disaster. We expected this palliative to arrive sooner rather than later. We are currently befuddled and hampered.”
“Anything can happen,” he said, “but it would be unfortunate if a new government began on that note. MSMEs have a large population, and the government should not take advantage of them.
“That would be unfortunate, and it would send a negative signal to foreign investors about MSMEs in the country.”
The Director-General of the Manufacturers Association of Nigeria, Segun Kadir, stated that the loan facility is a government recognition of the obvious credit gap for Nigerian manufacturing companies.
“I am aware that the government is consulting relevant stakeholders and working out the modalities for identifying deserving sectors and effective disbursement,” he said.
“We are hopeful that the process will be concluded soon and deserving companies will get the facility, disbursed by a credible financial institution, like the Bank of Industry.”
Meanwhile, the Nigerian Small and Medium Enterprises Development Agency has formed an assessment team to identify eligible applicants and pre-qualify them for the next stage.
The agency’s Director of Press stated that this had delayed the start of the SME program.
“Nothing has begun,” he stated. We are currently collecting data on MSMEs that may require funding; an assessment team will review the list of applicants to sort them and prequalify those who will proceed to the next stage.”
Attempts to contact the Ministry of Industry, Trade, and Investment for comment were futile because the Director of Press, Thomas Adebayo, did not respond to multiple phone calls and text messages sent to his phone number.
