BoI targets 2 million MSMEs with N120 billion in disbursements by year-end

• The Bank of Industry plans to disburse N120 billion to two million MSMEs by year-end
• The disbursements are part of its strategy to support economic growth and development.
• BoI is planning expansion in 2025, which includes having a presence in every state capital in the country

The Bank of Industry (BoI) says it plans to disburse N120 billion to two million micro, small and medium enterprises (MSMEs) across Nigeria by the end of the year.

BoI said the initiative aligns with its strategy of supporting economic growth and development by providing affordable capital for businesses.

The bank offers loans at single-digit interest rates to MSMEs while commercial banks do the same at 35 per cent, given the hike in the Monetary Policy Rate (MPR) by the Central Bank of Nigeria (CBN).

At the bank’s 65th-anniversary press conference in Lagos, Olasupo Olusi, the Managing Director and Chief Executive Officer, said the bank raised €2 billion (approximately N3.4 trillion) from international institutions, which bolstered its capacity to support Nigerian businesses. 

Olusi said, “As we mark this historic milestone, I would like to highlight some of the bank’s key achievements over time. In 2007, BoI’s authorised share capital was increased to N250 billion to put the bank in a position to address its mandate better. This was subsequently increased to N500 billion in May 2023.

“In recognition of the pivotal role of MSMEs in national economic development, the bank in 2014 engaged 122 SME consultants and entered strategic alliances with 10 SME-friendly commercial banks.

“Today, we have over 300 business development service providers supporting SMEs nationwide. The bank also has a robust on-lending programme with various financial institutions, including microfinance banks and fintechs.”

The bank also stated that its total assets grew from N3.9 trillion in December 2023 to N6.38 trillion by the end of September 2024.

MSMEs are critical to Nigeria’s economy – Omar

BoI’s Executive Director for MSMEs, Shekarau Omar, also noted that MSMEs in Nigeria, which are estimated at 40 million, play a crucial part in the economic development and growth of the country.

MSMEs, 89.4 per cent of whom are domiciled in the informal sector, contribute about 46.32 per cent to the country’s Gross Domestic Product (GDP) and account for 87.9 per cent of employment.

Omar highlighted the BoI’s efforts to support the sector through loan disbursements. He said the bank disbursed N64 billion to 1,000,250 MSMEs in 2023, more than its original target of N54 billion for one million enterprises.

He said the bank set a higher target in 2024, which has already been exceeded as it disbursed N107 billion to over 1.5 million MSMEs as of October.

Omar said, “We are on track to disburse between N115 billion and N120 billion by December 2024 to about two million MSMEs.”

2025 expansion plans

The BoI’s Executive Director for MSMEs said the bank plans to expand and has introduced programmes like the Rural Area Programme for Investment and Development (RAPID), which aims to bring financial services closer to underserved areas.

He said the bank has allocated N3.7 billion to support rural businesses under the programme, with disbursements to be made in the first quarter of 2025.

Omar also said that the bank plans to extend its presence to all the state capitals in the country by the first quarter of 2025 from the 33 states where it currently operates.

He said the expansion aligns with the bank’s memorandum of understanding (MoU) with state governments, valued at N12 billion over the past three months, to facilitate MSME growth in various regions.

Omar said, “By the end of Q1 2025, we aim to have a presence in every state capital in Nigeria.

“This bank belongs to the MSMEs and we are committed to being closer to them to effectively serve their needs.”

FG approves N75 billion loan scheme at 9% interest rate for MSMEs

Meanwhile, TheRadar earlier reported that the Federal Government approved a N75 billion loan scheme with a single-digit interest rate of nine per cent for 75,000 Micro, Small and Medium Enterprises (MSMEs) across the country.

The scheme, which will be disbursed in 2025 with individual loans capped at N1 million, is a joint effort among the Federal Government, the Bank of Industry (BOI) and state governments.