By Gift Samuel, The Sight News
ABUJA-In a bid to reduce youth unemployment and restiveness, the Central Bank of Nigeria in collaboration with the Bankers’ Committee on Thursday disbursed the sum of N115 Million to 358 Nigerians under the Agri-business Small and Medium Enterprise Investment scheme(AGSMEIS).
AGSMEIS is an initiative to improve access to affordable financing for Small and Medium Enterprises particularly those operating in the informal sector of the Nigerian economy and equipment worth N115 million was given to the first set of beneficiaries.
Speaking at the AGSMEIS launch in Abuja, the CBN Governor, Mr. Godwin Emefiele said that entrepreneurship development and easy access to affordable finance has so far proven to be one of the most effective ways to tackle the scourge of unemployment.
The Governor noted that the fund was set up by the Bankers Committee at its 331st meeting held in 2017, to help for job creation,financial inclusion and inclusive growth for Nigerians, particularly the teaming youth, adding that the outcome of the fund is expected to significantly reduce youth unemployment and increase economic growth.
Emefiele stressed that the challenges of youth employment in Nigeria must be confronted with strategic innovative thinking to provide sustainable solution, adding that irrespective of how daunting the challenges might seem, the scourge can be fought with unity of purpose.
He recalled that all Deposit Money Banks (DMBs) as a commitment to the successful development of the scheme, agreed to set aside and contribute five per cent of their profit after tax annually to finance eligible projects under the scheme, adding that the size of the fund stands at about N26 billion and is expected to exceed N60 billion by June 2018.
The apex Bank Governor explained that the beneficiaries of the fund are youths who have been trained on various entrepreneurship, vocational and management skills across the country by entrepreneurship development institutions and centres such as Fate Foundation, Lagos Business School, House of Tara and Thrive Agric.
According to him, “Over the years, people attend training and after those vocational trainings, they are unable to access finance to continue to live a reasonable life and we saw through this means. Once they have attended the training and they graduate from the training, we should make available to them the kit with which they can go into the world and begin to make money for themselves and for their family.
“So, this is an opportunity for us to say that even those who are weak and those that are vulnerable can also access bank loans, for them to continue thier lives, feed their families, live a gainful life, employ themselves and indeed also employ other people.
“Luckily the loans are for long term. We believe that they can service the loan again at five (5) per cent interest rate, those are the kind of things the weak, the vulnerable need for them to see that even we who are leaders are contributing to their own existence” he remarked.
Emefiele further explained that the AGSMEIS scheme would be implemented under three broad components; direct, indirect and developmental components. Under the direct component of the AGSMEIS, the CBN Governor said beneﬁciaries could access loans to a limit of N10 million at an interest rate of five per cent per annum and a maximum tenure of up to seven years.
Furthermore, he said that there was also a moratorium period of 18 months on principal and six months on interest element, depending on the nature of the business.
Under the indirect component of the scheme, the CBN governor said beneﬁciaries could access equity and quasi-equity investments of up to ten years with an initial lock up period of three years before divestment. He explained that the developmental component of the scheme would be used for capacity building and technical assistance to support beneﬁciaries.
On the criteria for selection, he said, “It is simple as there would be adverts by any of the entrepreneurial development sites indicating that they want to train people, people register for it and are trained for the programmes and data of what they need to go into the business is collected and checked for credibility and the amount needed to purchase the equipment determined before they are sent to the DMBs. The bank also confirm that you are their customer and your Biometric Verification Number is confirmed and with that, you are automatically enlisted for this facility”.
While stating that thousands of people are going to be reached through this means, he urged all beneficiaries to take good advantage of the opportunities made available to them, utilize funds judiciously according to the terms of the agreement and to repay thier loans to give room for other people to benefit as well.
On his part, the representative of the Bankers Committee, Mr. Wiwe Huberd said that the event marks the first of several of such initiative that will be given to several SMEs involved in the AGSMEIS , adding that the DMBs are determined to change the narrative of how banks are seen by being responsible contributors to the environment and society through lending support for the real sector and the young population.
He urged the beneficiaries not to see the loans as national cake, but to pay back the loans as at when due so as to become a foundation for other people to follow.
Some of the first set of beneficiaries which are 100 small holder rice farmers from Kebbi state trained by Thrive Agric received a tractor, another set from the House of Tara and Fate Foundation received their first set of photography equipment, sewing and embroidery machines and makeup starter kits.