FMO 7.5m euro investment in LAPO to enhance financial inclusion

Keying into the financial inclusion drive of the Central Bank of Nigeria (CBN), LAPO Microfinance Bank Limited last week signed an agreement with FMO, the Netherlands Development Finance Company, over a local debt facility to the tune of 7.5 million euro.

The loan will have a tenor of five years and will be used for providing funds to micro and small enterprise clients.

Penetration of financial service is low in the country and is expected that this partnership would help in promoting financial inclusion spherically among the grassroots.

At the signing ceremony in Lagos, Jaap Reinking, financial institutions director, explains that FMO (Netherlands Development Finance Company) is the Dutch Development Bank, saying FMO supports sustainable private sector growth in developing and emerging markets by investing in ambitious entrepreneurs. FMO believes that a strong private sector leads to economic and social development, empowering people to employ their skills and improve their quality of life. FMO focuses on three sectors that have high development impact: financial institutions, energy, and agribusiness, food and water. With an investment portfolio of 6.6 billion euro, FMO is one of the largest European bilateral private sector development banks.

Jeroen Harteveld, financial institutions – Africa investment officer, says FMO has invested about $340 million in Nigeria in financial institutions like bank, motor industry, fertiliser – agriculture, processing, oil, among others, noting “we are interested to do more in Nigeria.”

Godwin Ehigiamusoe, managing director/CEO of LAPO, says at ceremony that with the partnership the bank will be able to expand its reach in terms of diversification of its products, saying LAPO is focused on the issue of sustainability, creating initiatives on preserving the environment.

“There are a lot of initiatives we focus on, including implementation of clean energy, lending to acquire clean cooking gas, promoting use of sola energy in provision of light in rural communities. We also run scholarship programme for the children of our clients, which not only reliefs the burden of school fees but provides them with quality education.

“We see the partnership to further our programme and helping us diversify our products, we value and appreciate this partnership. It will be beneficial to our people and contribute to national development. Penetration of financial services is still low, this will enhance financial inclusion,” according to him.

LAPO was set up by Godwin Ehigiamusoe as a non-profit microfinance institution, in the late 1980s, to provide financial and social empowerment services to members of low-income households. LAPO MfB transformed into a licensed Microfinance Bank in 2010 and currently is one of the leading microfinance banks in Nigeria, with presence in 27 states and a client base of over 1 million.