Our interventions in economy driven by market failure – CBN
The Central Bank of Nigeria (CBN) has explained that its interventions are born out of market failure and other critical issues within the nation’s economic space.
Currently, the CBN has 37 intervention funds targeted at stimulating the economy and addressing the issue of unemployment.
“What we need to understand about CBN’s interventions is that it is purpose driven, it is functionally based and it is also well thought out,” Osita Nwanisobi, acting director, corporate communications department, CBN said at the CBN’s fair held virtually in Lagos and Abeokuta in Ogun State.
He said interventions like the refinancing restructuring facility, or the Power Airline Intervention (PAIF), came in the aftermath of the global financial crisis.
“It was part of our quantitative easing. After the global financial crisis the banks were stabilised. Stabilizing the banks we had another issue and that became unemployment.
“As someone who has the vision of building a people’s centered Central Bank, Emefiele said we must tackle unemployment. So you saw the Real Sector Support Facility (RSSF), the whole essence is to stimulate the real sector,” he said.
Nwanisobi explained that Agri-Business/Small and Medium Enterprise Investment Scheme (AGSMEIS), speaks to the young generation who don’t have the collateral, who don’t have what it takes to access the normal traditional loan from the bank. When they come to NIRSAL microfinance banks, nobody asks them for collateral.
“All we say is that for you to access this intervetion fund you need to have gone through vocational entrepreneurship education and the essence is to enable them to understand the norms of establishing and handling a business so that when they start they will understand that the business is totally for themselves,” he said.
He said 70 percent of the loans will be used to procure equipment while the remaining 30 percent would be given to people as working capital to enable them start up something.
The CBN acting director explained that the CBN Fair created a platform to interact with significant stakeholders and that during the fair, the banks and other financial institutions regulator explained to the stakeholders some of it’s policies, interventions, initiatives and programmes , and also received their responses.
Atise Johnson Ekhato, CBN branch controller, Lagos, said the economy was already showing signs of positive indicators towards recovery.
He called for the implementation of policies that enable Small and Medium Enterprises (SMEs) thrive, saying a thriving SME will help to catalyse growth of the economy.