LDR: CBN Urges Banks To Increase SME Lending

Monday, October 07, 2019 / 2:44 PM / Nifemi Taiyese forProshare WebTV / Header Image Credit: Nairametrics

Last week the Central Bank of Nigeria (CBN) reviewed upward banksLoan-To-Deposit Ratio, LDR, from an earlier 60% in September 2019 to 65% inDecember 2019.

The CBN also re-emphasized the need for the banks to increaseMSMEs lending considering the role they play in driving the economy.

About 12 DMBs were fined for not meeting the initial LDRrequirements of 60% by September 30^th, 2019.

Other developments that occurred during the previous week include;

Union Bank Secures $200m OPIC Funding For MSMEs

UnionBank of Nigeria Plc. announced that it has secured US$200 million in fundingvia a partnership with sub-Saharan Africa financial services group, Atlas MaraLimited, in agreement with Overseas Private Investment Corporation, the U.S.government's development finance institution.

The agreement is consistent with UnionBank's long-standing commitment to enabling enterprise and empoweringwomen-owned businesses. Earlier this year, Union Bank launched Alpher, adynamic proposition aimed at uplifting women across all segments of theNigerian society through capacity building opportunities, networking platforms,scholarships and tailored financial services for women.

Cashless Policy: MAN Raises ConcernsFor MSMEs

TheManufacturers Association of Nigeria said the implementation of the cashlesspolicy may have negative impact on the Micro, Small and Medium Enterprises.

TheDirector-General of MAN , Mr Segun Ajayi-Kadir disclosed this recently.

Hedescribed the MSMEs as the engine room of the economy, especially due to itsemployment generation capacity.

TheMAN DG said the Central Bank of Nigeria failed to make any consultations andsensitisation of the relevant stakeholders before reintroducing the cashlesspolicy.

Healso noted that the government ought to have put in place the necessaryinfrastructure that would support and drive the policy before announcing it.

MSME Development: Edo State Earmarks N2bn Single-Digit Lending

TheEdo State Governor, Mr. Godwin Obaseki has said his administration has providedthe sum of N2 billion as credit facility at single digit interest rate to microsmall and medium enterprises (MSMEs) across the state.

Hesaid the move became necessary in order to drive the state's economy throughthe contributions of small businesses.

Speakingat the Edo State Special Day at the on-going 2019 Abuja International TradeFair (2019AITF) organised by the Abuja Chamber of Commerce and Industry (ACCI),the governor also said his administration had achieved 75 per cent job creationout of the 200,000 jobs that it had promised to create for its citizens.

SunTrust Bank Targets MSMEs for Inclusion, Opens New Branch AtIdumota

SunTrustBank Nigeria Ltd, in a bid to providing micro, small and medium scaleenterprise financial services disclosed that it is exploring financialinclusion to traders, who do not have access to the services of a bank orfinancial organization.

TheMSME is a sector that should be highlighted as it is going to foster theeconomy, which is why this is the focus of the bank and the decision to open anew branch at Idumota the business center of Lagos which holds numerousexcluded businesses.

This according to SunTrust will deepen financial inclusion inNigeria and address the poverty rate in the country.