MICROCAPITAL BRIEF: Nigerian Government, Bank of Industry (BOI) Launch National Women Empowerment Fund (NAWEF), Charging Flat 5% Fee for Microloans Totaling $4.5m

The Nigerian government recently issued NGN 1.6 billion (USD 4.5 million) to the National Women Empowerment Fund (NAWEF), a new funding mechanism that will provide women with 6-month, collateral-free loans of between NGN 10,000 (USD 28) and NGN 100,000 (USD 278). The borrowers will pay a 5-percent administrative fee, but – in accordance with Islamic law – no traditional interest payments will be charged.

NAWEF is part of the Government Enterprise and Empowerment Programme (GEEP), which provides microcredit to both men and women with the intent to “reduce poverty among rural dwellers.” Its strategy is to “provide skills development, [and] training and business support” as well as “soft loans to 1.6 million beneficiaries nationwide, mainly market women, youths, artisans, and farmers.” GEEP, which is administered by the government-owned Bank of Industry, was created as part of the federal government’s Social Intervention Package, which had a total budget of NGN 500 billion (USD 1.4 billion) as of 2016.

Based in Lagos, BOI was incorporated in 1964 as the Nigerian Industrial Development Bank. In 2001, it was restructured as a development finance institution under its current name to promote the emergence of a competitive industrial sector in the country. As of December 2016, BOI reports total assets of approximately NGN 683 billion (USD 1.9 billion) and NGN 518 billion (USD 1.4 billion) in loans and advances.

By Aleks Marceau, Research Associate

Sources and additional information

Article from the Sundiata Post:
http://sundiatapost.com/2017/07/25/fg-sets-aside-n1-6b-for-women-empowerment/

Nigerian government home page:
http://www.nigeria.gov.ng

BOI home page:
http://www.boi.ng

More on GEEP from BOI:
http://www.boi.ng/boi-disburses-n83-5bn-to-776-enterprises-in-2015-posts-n44-7bn-profit/

More on BOI in Nigeria from MicroCapital:
https://www.microcapital.org/microcapital-brief-nigerias-bank-of-industry-boi-earmarks-105m-for-micro-small-medium-sized-enterprises-msmes-in-the-country/

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