The government of the Nigerian state of Ondo disbursed NGN 2 billion (approximately USD 13 million) to create the Micro, Small and Medium Enterprises Development Fund, which will provide wholesale funding and refinancing liquidity for microfinance institutions (MFIs).
The Bank of Industry (BOI), a bank established to promote the development of small and medium-sized industries in Nigeria, supplied half of the funding with remainder coming directly from the Ondo government. The fund is intended to empower small and medium-scale entrepreneurs and cooperative groups in manufacturing and other value-added industries in Ondo.
The creation of the fund is part of a plan to restructure the Development Finance Activities of the Central Bank of Nigeria (CBN) to more effectively pursue its goal of financial inclusion for unbanked Nigerians. Previous development finance activities of the CBN were separated into a microfinance program, small and medium-sized enterprises financing and the operation of a Small and Medium Enterprises Equity Investment Scheme (SMEEIS).
By Witt Gatchell, Research Associate
About Central Bank of Nigeria (CBN):
Central Bank of Nigeria (CBN), established in 1958, is Nigeria’s central banking authority. As defined by the 1958 Act of Parliament that created CBN, its statutory mandates are as follows: “to issue legal tender currency; to maintain external reserves; to safeguard the international value of the legal tender currency; to promote monetary stability and a sound financial system in Nigeria; and to act as banker and financial adviser to the Federal Government.” As of July 2010, CBN reports total assets of NGN 7.37 trillion (the equivalent of USD 48.6 billion).
Sources and Additional Resources:
[1] The Nation: “Ondo disburses N2b to micro finance scheme” http://thenationonlineng.net/web3/business/22609.html
MicroCapital Universe Profile: Central Bank of Nigeria (CBN)
https://www.microcapital.org/microfinanceuniverse/tiki-index.php?page=Cen…
MICROCAPITAL STORY: Why the Central Bank of Nigeria’s Small and Medium Enterprises Equity Investment Scheme (SMEEIS) was Replaced by a Fund for Microfinance, July 22, 2008
https://www.microcapital.org/microcapital-story-why-the-central-bank-of-n…
MICROCAPITAL BRIEF: Central Bank Of Nigeria (CBN) Issues Guidelines On Operation Of The Microcredit Fund, December 8, 2009
https://www.microcapital.org/microcapital-brief-central-bank-of-nigeria-c…
MICROCAPITAL STORY: Small and Medium Enterprises Development Agency of Nigeria (SMEDAN) and Microfinance Banks Association of Nigeria Partner Together in Nigeria’s Microfinance Sector, August 1, 2010
https://www.microcapital.org/microcapital-story-small-and-medium-enterpri…
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