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In a report by AllAfrica.com, at the 2008 annual dinner of Bankers’ Clearing House Committee which was held at Hamdala Hotel Kaduna, Alhaji Mohammed Ibrahim Gusau, the Kaduna Branch Controller of the Central Bank of Nigeria (CBN) announced that 18 community banks in the state of Kaduna had already converted to microfinance banks and that as of January this year, 23 microfinance banks had been licensed or given approval-in-principle to operate.

Royal Exchange Plc, a Nigerian insurance company, has received approval from the Central Bank of Nigeria (CBN) to operate a microfinance bank according to a report on Nigeria’s Business Day Online.  Having satisfied all statutory requirements for opening a microfinance bank, Royal Exchange is currently making preparations to begin operations in the next few months.  The new venture is in line with the company’s mission to evolve into one of the leading financial service firms in the world.  According to Royal Exchange Group Managing Director Allan Walmsley, “That vision has seen us strategically restructure our operations while a comprehensive and integrated rebranding project also is currently underway.”   Other components of this vision include technology upgrades, human capital development, risk management, product enhancement and diversification.  Walmsley also stated that the company envisions “a number of strategic acquisitions to assure our future in the non-banking, financial services industry.” 

Nigerian president Umaru Musa Yar’Adua has approved that the construction of a NGN 200 billion (USD 1.35 billion) agricultural fund to be disbursed to commercial farmers in Kano at an interest rate of nine percent through commercial banks. The Central Bank of Nigeria (CBN) is responsible for overseeing and creating guidelines for the distribution of the fund. For more on the CBN, please read this MicroCapital article. CBN will also collaborate with the Federal Ministry of Agriculture and Water Resources to monitor the fund’s implementation.

The Nigerian microfinance sector is facing a setback in the wake of several issues plaguing the country’s microfinance institutions (MFIs), according to a press release on the Nigerian weekly NEXT. NEXT is a publication of Timbuktu Media, a media and information company based in Lagos, Nigeria, and founded by Dele Olojede, Africa’s first winner of the Pulitzer Prize (for International Reporting). Stating that the country’s microfinance sector has been ‘caught’ in the midst of an ‘inefficient Nigerian economic system’, the release cites several reasons why MFIs in Nigeria are not in alignment with their goal of increasing financial access to the poor.

Much Ado About Nothing: The Case of the Nigerian, Microfinance Policy Measures, Institutions and Operations; By B. O. Iganiga and published in The Journal of Social Science. The original paper is 13 pages and available here.

The Lagos State Government has provided loans worth NGN 7 million (approximately equivalent to USD 48k) in an effort to provide access to financial services to Small and Medium Enterprises (SMEs) in the city of Ikorodu. According to a press release on the Nigerian daily, punchng.com the loan was facilitated by Ms. Abike Dabiri-Erewa, a member of the House of Representatives. punchng.com is owned and operated by the Nigerian newspaper, The Punch. Speaking during the presentation of checks to the beneficiaries of the scheme, Ms. Dabiri-Erewa described poverty as ‘multi-dimensional’ and called for effective implementation of microfinance schemes as a means to address poverty in Nigeria. The release quoted her as saying that microfinance was a vital instrument for self-empowerment, enabling the poor to become agents of economic ‘change’. This loan by the Lagos State Government is among a series of efforts by other local and state governments in Nigeria to address poverty through microfinance.

The Federal Government of Nigeria disbursed loans worth Naira 81 million (approximately USD 543k) to encourage employment generation in the country. According to a press release on AllAfrica.com, these loans were disbursed in the capital city of Ajuba and chaired by the Secretary to the Government of the Federation (SGF), Alhaji Yayale Ahmed. The loan drawn was from the Enterprises Creation Fund which was launched by The National Directorate of Employment (NDE) in partnership with the Nigerian Agricultural Cooperative and Rural Development Bank (NACRDB). According to the release, the partnership between NDE and NACRDB was established in 2004. The loans were provided as soft loans to 370 beneficiaries to help them establish small business enterprises in keeping with the Directorate’s efforts to create and promote small businesses. Soft loans are loans that have extended grace periods and below-market rates of interest. No information on the interest rate charged for these loans is available.

Integrated Microfinance Bank Plc (IMFB), a Nigerian based microfinance institution (MFI) has commenced operations in the Nigerian State of Kaduna. This announcement was made by Mr. Simon Ankinteye, the managing director and chief executive officer of IMFB during a chat with reporters in Lagos, Nigeria, according to a press release found on the news portal, NigerianBulletin. The release quoted Mr. Akinteye as saying that IMFB would offer the people of Kaduna banking services and other products such as lease financing, partnership financing, investment account for children, a trust fund and a savings account. He also added that specialized skill training would be provided to empower the people of Kaduna to ‘live above poverty levels’.

Kings Microfinance Bank (KMFB), a Nigerian based microfinance provider announced that it has disbursed loans worth Naira 50 million, approximately equivalent to USD 367 thousand, to nearly 5000 Nigerians over the last several months. This announcement was made by Mr. Laide Adebayo, the Managing Director of KMFB during a chat with journalists at Lagos, Nigeria, according to a press release found on Vanguard – Nigeria. KMFB is one of the 815 organizations that have been licensed by the Central Bank of Nigeria (CBN) to supply credit to the marginalized poor and thereby support the Nigerian Government in its efforts to address poverty and meet the United Nations’ Millennium Development Goals (MDGs). Originally founded as Maryland Community Bank, KMFB registered as a Microfinance Bank in January, 2008. KMFB does not report to the MIX Market, the microfinance information clearing house, nor has it published its financial data on its website. Hence information on its total assets, loan portfolio and client base is not available.

The Governor of the Central Bank of Nigeria (CBN), Charles Soludo, said in Lagos on Tuesday that only 12 out of 36 states in the country have contributed to microfinance activities in their states to the tune of N12.08 billion, approximately USD 1.26 million.  The governor of the apex bank who was speaking at the launch of Enhancing Financial Innovation and Access (EFINA), a nongovernmental organization, named the states (rank by population) as Zamfara (21), Delta (12), Lagos (2), Ekiti (29), Kebbi (23), Kwara (30), Ondo (18), Kogi (20), Cross River (27), Benue (9), Anambra (10), Osun (19) and Oyo (5).  Lagos state has disbursed N620 million, or USD 5.3 million, within one year through selected microfinance banks, Delta state has disbursed N600 million, approximately USD 5.1 million, through Oceanic Bank and some microfinance banks while Osun disbursed N99.78 million, approximately  USD 8.5 million, through the Nigerian Agricultural Cooperative and Rural Development Bank (NACRDB).

Source: All Africa.
Original news wire here.

The Central Bank of Nigeria (CBN) granted licenses to 815 microfinance institutions (MFIs) at a ceremony officially launching of the results of an EFINA survey on the adult banking population. The organizations to which licenses were granted were not listed, however a complete list of MFIs operating in Nigeria can be found on the CBN website. Representatives from CBN addressed the need for additional MFIs operating throughout Nigeria, acknowledging that there is a fragmentation of the concentration of MFIs throughout the different states of Nigeria. It was stressed, however, that although the CBN will endeavour to increase the licenses granted to MFIs, the CBN will not hesitate to withdraw licenses from MFIs who fail to adhere to the regulations.

This past spring, the Nigerian government cut its Small and Medium Enterprises Equity Investment Scheme (SMEEIS) due to a lack of success and underutilization. Recently, many comments by officials as well as outside criticisms have surfaced, explaining and defending the decision to cut SMEEIS and instead support the Nigerian Microcredit Development Fund.

Source: allAfrica.com.