Learn more on how to apply for CBN Loan for Micro, Small and Medium Enterprises Development Fund (MSMEDF). If you are interested kindly know that the categories of entrepreneurs that can apply for the Fund is Micro entrepreneurs and Small and Medium Enterprises (SMEs)
However, a loan is usually an amount of money given to an individual or an institution on the condition that it will be repaid at a later date, with or without interest. Other assets such as land, machinery, and buildings can also be given out as loans.
Contents
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What categories of entrepreneurs can apply for the Fund?
These financial institutions serve two groups: Micro entrepreneurs and SMEs-
- Micro entrepreneurs (i. e. borrowers seeking loans of less than N500,000) are to approach any of the four institutions:
- Microfinance Banks
- NGO/Microfinance Institutions
- Financial Cooperatives
- Finance Companies
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- Small and Medium Enterprises (SMEs): Prospective borrowers seeking between N500,000 and N50million.are to approach any of these institutions:
- Deposit Money Banks
- Bank of Industry (BOI)
- Bank of Agriculture
Types of businesses that can be financed under the Fund
- Agricultural value chain activities,
- Manufacturing & Cottage Industries,
- Artisans,
- Services,
- Trade and general commerce,
- Renewable energy or energy-efficient products and technologies, and
- Any other income-generating projects as may be prescribed by the CBN.
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Important information borrowers need to know
- Prospective borrowers are to provide the required documents including collateral for SME loans;
- PFIs will appraise loan applications, approve and forward loan requests of borrowers to the CBN for the release of funds;
- MSMEDF will only release funds to borrowers through the PFIs;
- The account of benefitting borrowers shall be credited by the PFIs within 5 working days upon the release of Funds by MSMEDF to the PFI;
- Loans shall be granted at an interest rate of 9.0% per annum (all charges inclusive) irrespective of the type of eligible activity financed;
- Borrowers shall be expected to pay back all loans as and when due inclusive of any accrued interest to the PFI; and
- The MSMEDF/CBN will recycle all fully repaid loans transferred to it by the PFIs.
You can find out more about CBN loan here.