Rogers Nwoke,the National President of National Association of Micro- finance Banks,(NAMB) on Friday said the establishment of the Micro Finance Company Limited with an authorized share capital of N500m would enable the association attract more wholesale capital that drives fund availability to small scale businesses.
Speaking at the 2019 annual meeting of the association,themed:’ Sustainable and Innovative digital finance in MSME Development in Nigeria.’ Rogers said the MIcro finance development company would serve as a special purpose vehicle to manage on-lending wholesale funds for the benefit of the banks and the sector as a whole.
He notes further that the association’s intent of establishing the company is to ensure it reaches out to respective members according to its risk acceptance criteria in terms making funds available at better rate for easier access to small scale businesses.
On the Micro Finance Development company,he said,”The company has developed,risk acceptance criteria for each unit of every micro finance bank.We developed different risk acceptance criteria and use them to attend to them. According to their size,capitalisation and otherwise,we then give the micro finance banks according to their needs and circumstances.”
“Our Association in collaboration with all the Micro Finance Banks in Nigeria had set up a company called the Micro-finance Bank Development Comany-which has a capital base of N500mn.Taking risk off that micro-finance Bank,which is going to be a special purpose vehicle for managing that company.”
“I can tell you within the first one year of establishing this company,we would float micro-credit bond. Nobody has floated micro-credit bonds because issues of confidence,.In this company, we would resort to International Finance Corporation,others to assist us facilitate the credit bonds,while showing the people of this country-that it is the small,and medium enterprises that are holding the future of this country’s economic development.
“DBN, BOI are providing funds and services,but it is more like a drop of water..Ours will be different because we know our members. Nobody knows our members more than us.We would encourage DBN’s of this world to give us money wholesale money to disburse to our members.
Stating futther the associations’s postion,he said,”Our position, however is that there should be an Micro finance development fund.The MSME intervention fund is great but not exclusive to Micro-finance Banks.We need that fund to come to Micro finance bank.
There is need to establish a micro-finance development fund,as contained in the micro-finance Bank policy framework,he notes further.
In his goodwill message,Senator Abdullahi Adamu raised concern on a new federal government policy that might pose existential threat to the micro finance industry.
Adamu said,”In April this year,the government serbed a notice that it would raise the microfinance bank capital from N20 million to N200 miillion from April next year.I do not know the rationale for this new government policy,but I have not doubt in my mind it would be inimical to the industry.
The microfinance banks were creared to assist small and mdium scale enterprises.They are the people’s bank.They are the banks that can give life line to medium and small business enterprises.I find no merit in this new federal government’s policy”Adamu insist.
There are currently 918 micro finance Banks lincenced and operating in the country.
HARRISON EDEH,ABUJA
