The African Development Bank(AfDB) has offered N15.35 billion facility to Fidelity Bank Plc, for the growth of Micro Small and Medium Enterprises (MSMEs) in Nigeria.
The facility is planned to boost the bank’s capacity to promote the growth of MSMEs , with 7 years credit and 2-year moratorium.
30% Of The Fund Dedicated To Women Entrepreneurs
The treaty was signed yesterday in Abuja by both parties, where it was disclosed that the facility will be devoted to funding the MSMEs and a minimum of 30% (N4.605 billion) of the entire financial package will be dedicated to women-owned businesses.
AfDB Senior Director/Country Representative, Ebrima Faal, who put pen on paper on behalf of the multilateral institution, said the development finance institution was excited with Fidelity Bank’s partnership.
He stated that: “The lines of credit tend to be general support for SMEs. This one has strong emphasis on gender. It can be considered as a vanguard credit for us. Our main focus is to reach out to SMEs to give the much-needed impact.”
Faal, therefore urged the bank to ensure that the condition for loan disbursement is flexible to enable it reach the target audience. He further stated that the N15.35 billion credit would play a role to firming up Fidelity Bank’s presence in its key market segment.
Fidelity Bank’s Deputy Managing Director, Mohammed Balarabe, who signed for Fidelity bank, said that “the line of credit granted to the (Fidelity) bank is particularly unique, because gender has been brought in. With 30% of this loan targeted at MSMEs that are solely driven by women.
Speaking to the issue of how the commercial bank will select the businesses that will benefit from the 30% facility set aside for women entrepreneurs, Balarabe said: “They have to be run by women. Most importantly, it is aimed at businesses at low levels so that they can spur development in the country”.
NIGERIA’S MSME Sector
“The MSME sector remains the most active in terms of creating employment and furthering development. That is why the AfDB in conjunction with Fidelity bank extends a line of credit to such businesses at cheap rates, which are far lower than market rates.” Balarabe said.
The $50 million facility from the African Development Bank, will enhance Fidelity Bank’s liquidity and help it meet the demand for medium-term financing to players in the MSMEs segment.
African Development Bank
The AfDB is a multinational development finance institution established in 1964, with a mission to promote sustainable economic growth and reduce poverty in Africa.
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