Nduka Chiejina (Assistant Editor)
Development Bank of Nigeria (DBN) says it has disbursed over ₦100 Billion loans to over 95,000 Micro Small and Medium Enterprises (MSMEs) across various sectors of the economy.
According to a statement on Sunday in Abuja, the bank disclosed that “70% of these loans went to women-owned/managed businesses while 51% so far were disbursed to youth owned businesses.”
The current figure of ₦100 billion loans is ₦30 billion more than what the bank had disbursed in July, 2019.
The statement also said that the DBN “is deploying new strategies to boost the growing the network of MSMEs that it is financing across the country and extend its reach to underserved areas.”
In this regard, the “DBN is taking several measures including the expansion of its capacity building programmes in the North East, South East and North West which have witnessed comparatively lower rates of disbursement.”
The objective of this capacity building it was noted “is to boost the capacity of local entrepreneurs to meet its requirements and qualify for inclusion for DBN support.”
This the bank claims is in line with the it’s mandate “to support the stimulation of diversified and inclusive growth and alleviate specific financing constraints that hamper the growth of domestic production and commerce by providing targeted wholesale funding to fill identified enterprise financing gaps in the MSME segment.”
Managing Director of DBN, Mr Tony Okpanachi stated that “a major challenge faced by the MSMESs is their inability to structure and put together a bankable business plan which makes banks view them as high risk and therefore unwilling to finance them.”
To fix the problem and make MSMEs attractive to DBN’s Participating Financial Institutions (PFIs), Okpanachi said that DBN’s “Chief Operating Officer will work with relevant departments within DBN to put together an immediate capacity building plan that will involve assembling a number of MSMEs in Borno State and make them go through an extensive capacity building programme.”
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DBN commenced lending operations in November of 2017 with two microfinance banks namely, LAPO and NPF with a pilot loan amount of ₦200 million to roughly 300 MSMEs.
In 2018, the bank’s first full year of operation, it increased disbursements to roughly ₦30 Billion and reached 35,000 MSME’s in the country. In July, 2019, the DBN said it had “lent more than ₦70 billion and impacted on more than 50,000 MSMEs” hinting that when the capital expansion is executed, more funds will be made available to more MSMEs which contribute about 60% to the GDP.
Mid year, DBN made a proposal to have more funds to support Small and Medium Enterprises (SMEs) by growing its capital base in the next two years. This is yet to be achieved.
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