The Nigerian Bank of Industry has cleared the air on some bottlenecks surrounding accessing funds from the bank.
The BoI’s Divisional Head, Small and Medium-sized Enterprises for South, Mr Obaro Osah, made the clarification at a webinar hosted by the Lagos Chamber of Commerce and Industry on Tuesday.
He refuted as untrue perception by some people that a borrower must know and pay someone at the bank to access fund; or that it takes a year to process and access funds; or that the bank only supports the manufacturing industries.
“The loan application approval processing timeline for loans below N10m is four weeks, loans between N10m and N100m is six to eight weeks.
“Loans above N100m to N500m is eight to10 weeks,” Osah explained.
The BoI’s Deputy Head, Business Development, Mrs Aderonke Akinluyi, at the event disclosed that the bank has disbursed loans worth N969.7bn to borrowers in the last five years to support various businesses.
Akinluyi said the funds were disbursed between 2015 and 2020 to over three million Micro, Small and Medium Enterprises and 653 large enterprises.
She hinted that the bank was currently collaborating with over 330 Business Development Service Providers to offer advisory and business support services aimed at improving intending MSMEs.
“Our business model reflects our goal to drive development through financial and advisory support to all customer levels, with dedicated teams for MSMEs, youths and women-led enterprises.
“Our collaboration with the BDSPs ensures that the MSMEs are almost handheld in structuring, and preparing their business models and plans.
“The collaboration also provides other entrepreneurial training as required and are split across the regional, state and national categories,” she added.
The BoI’s selected loan products include agro mechanisation, food and agro commodity processing and commercialisation of solar energy.
The President of LCCI, Mrs Toki Mabogunje, noted that limited access to funding was one of the biggest constraints facing businesses, especially MSMEs.
Mabogunje said a report by the PriceWaterhouseCoopers, revealed that Nigerian SMEs had a funding gap of about N617bn as of 2019.
According to her, evidence shows that majority of Nigerian MSMEs have not significantly benefited from available financing opportunities in the country.
She attributed the development to lack of information (on the part of businesses) about the funding schemes offered by different institutions and the inability to meet the requirements for funding.
Others are contravening application guidelines, submission of wrong or outdated documents (such as tax certificate, financial reports, CAC registration certificate) and poor record keeping, Mabogunje said.
“Also, poor credit history such as failure to service previous facility prevents business owners from accessing another.
“The combination of these factors account for the challenges of access to credit by SMEs,” she added.
