Senate Decries N40b Funding For MSMEs

The Chairman Senate Committee on Industry, Senator Tokunbo Abiru, yesterday expressed dissatisfaction with the ‘meagre’ N40billion  released to finance Micro, Small and Medium Enterprises (MSMEs) development in the country by the Bank of Industry (BoI) in 2021.

Tokunbo made the observation when his committee had an interactive session with the Managing Director of BoI, Olukayode Pitan, on the 2021 Budget in Abuja.

Pitan had informed the committee that the bank has released N165billion to large enterprises  while MSMEs got N40 billion as at last month.

The BoI boss explained that only N40 billion was released to MSMEs because most people at that level were not ready to repay the loan as they believed that the cash was government money that should not be repaid.

The Committee wondered how could N164billion go to large enterprises while MSMEs got only N40billion, describing the development as sad.

Meanwhile, members of the Committee took the Managing Director of the bank to task over loan beneficiaries.

Trouble started when the Managing Director of BoI claimed that the bank does not know the actual beneficiaries of its loans, but only the destination.

He said the loans were secured through bank guarantees provided by commercial banks for the beneficiaries.

“Loans are given to commercial banks that provide guarantees, which then forward the money to the beneficiaries,” he said.

Apparently dissatisfied with the claims of the Managing Director of BoI, Senators Adamu Bulkachuwa, Christopher Ekpenyong and Danjuma La’ah said they are completely in the dark about the activities of BOI in their Senatorial Districts.

Senator La’ah said: “I don’t know what is going on with Bank of Industry activities in my Senatorial District.”

Senator Ekpenyong in his reaction lamented that most of the his constituents were unable to access loans from BOI since Union Bank and United Bank of Africa (UBA) do not give Bank Guarantees to his constituents.

On his part, Senator Bulkachuwa said: “The MD/CEO, you made comments while trying to answer my questions on the distribution of loan beneficiaries.

“You actually said that you were not in the position to know exactly where these loans are going to, with regards to the geopolitical areas of the country.

“Does it mean that the Bank of Industry does not know where the loans are going to and where the actual beneficiaries are located in the country? We are interested in knowing where those loans go to.

“You, the giver of the loan should be more interested in the loan and where each kobo you give out is going and which part of the country is benefiting.

“You should be able to know. You should not leave it for the commercial banks to handle alone.

“Our interest is to know how the Bank of Industry is performing its duties in terms of ensuring that industries are spread across the country.”

Pitan said, “The Senator misunderstood me. BOI knows where our money is. We know where every kobo goes to.

“I was actually answering a question on whether we are the ones that determine the beneficiaries.

“The commercial banks are the ones that give guarantees because they are the ones that would finalise the process.

“They determine where the loans go but there is no loan that goes out of the bank of industry that we on our own, don’t analyse.

“It is a requirement every month for the Bank of Industry to provide the document. We know exactly where our monies are.”


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