Government of the State of Osun is set to begin the disbursement of over N615 million to micro and small businesses, General Manager of Osun Micro-credit Agency, Mr. Dayo Babaranti, stated this at the weekend.
Babaranti added that the state had so far given out about N4.8 billion to about 28,000 residents to support their businesses.
He said the N615.150 million received from the Central Bank of Nigeria (CBN), is a part payment from the N2billion revolving Micro Small Medium Enterprise Development Fund (MSMEDF) loan being given to states by the apex bank.
Babaranti, who spoke in his office in Osogbo, the State capital, added that since 2014, the Federal Government through the CBN, had been releasing intervention funds (MSMEDF) to support socio-economic activities in states.
The General Manager said the N4.8billion received through the CBN micro credit scheme was disbursed to citizens as soft loans to support small businesses.
According to him, the State of Osun was rated first among the 36 benefiting states of the CBN’s MSMEDF because of its promptness and diligence in repayment and for using the funds for the primary purpose it was meant.
Speaking on the terms and conditions for accessing the loan, Babaranti said the agency had maintained simple and bearable requirements for the citizens, adding that the scheme had helped to rekindle the hope among the citizens who were unable to meet the condition to obtain loans from commercial banks.
He said: “This scheme has been really helpful in boosting socio-economic activities in the state as thousands of people have benefited from it. Our State has received N4.8billion since the intervention of the CBN on MSMEDF began in 2014, and so far so good, over twenty eight thousand (28,000) people have benefited from this scheme.
“We have recorded over 70 per cent repayment by beneficiaries. We divide our lending scheme into three categories to accommodate all sectors and these include: individual lending, group lending and SME lending. The maximum amount individual lenders can benefit from this agency is five hundred thousand (N500,000) and this must be paid back within one year.
“We are empowered to give from zero to N5 million to those who are operating Small and Medium Enterprise, while those under the umbrella of co-operative or group can access limitless funds depending on the strength of their membership.
“This scheme has helped our people to expand the scope of their businesses, reduce unemployment, eradicate poverty, banish hunger and create a sense of belonging for all. It has helped to improve on the capital of the participating Microfinance Banks which has translated into increased sales volume.
“We have made significant improvement on the Internally Generated Revenue (IGR) of the state through tax payments from the income earned by the beneficiaries.
Through this scheme, the 9 per cent interest of the facility has forced all Microfinance Banks in the state to review downwards their hitherto high interest rates.
“The participating Microfinance Banks have employed more staff to manage the funds under the scheme thus, reducing unemployment rate in the State. This scheme has helped some jobless individuals to be gainfully employed through the disbursement of the funds and expansion of small and medium enterprises.
“The scheme has helped to encourage many Osun indigenes in other states to bring their businesses back to enable them enjoy the loan facility. The funds given through this scheme has brought into being the culture of proper record keeping among the beneficiaries and as well helped to increase the confidence of citizenry in the government of the day.
“The productivity of the SME beneficiaries has improved because the facility afforded them the opportunity to buy state-of-the-art equipment to run their businesses.”