The Federal Government has commenced the disbursement of a N75 billion loan to manufacturers, 14 months after initially announcing the initiative.
Facilitated through the Bank of Industry at an annual interest rate of nine percent, this loan is designed to assist larger companies in navigating the ongoing economic challenges and managing production and operational costs. The primary objective of this initiative is to bolster the manufacturing sector, increase production capacity, and ultimately stimulate economic growth.
Segun Ajayi-Kadir, the Director General of the Manufacturers Association of Nigeria (MAN), confirmed the start of loan disbursements during an exclusive interview with Sunday PUNCH on Friday.
In December 2023, the Federal Government introduced the Presidential Conditional Grant Scheme as part of its Presidential Palliative Programme, which aimed to support businesses in coping with the economic impact of government policies. The scheme allocated N75 billion to Micro, Small, and Medium Enterprises (MSMEs) and an additional N75 billion for the manufacturing sector.
However, the complex and lengthy bureaucratic processes within the government delayed the timely release of funds to recipients who had been eagerly awaiting their payments.
Doris Aniete, the former Minister of Industry, Trade, and Investment, indicated that over 700,000 manufacturers and MSMEs had expressed interest in receiving the loan. However, Ajayi-Kadir clarified that the program would specifically provide N1 billion each to 75 registered companies under the Manufacturers Association of Nigeria.
He stated, “We have signed a memorandum of understanding with the Bank of Industry to initiate the disbursement of the N75 billion loan to manufacturers. Some members have already started receiving their funds. The MOU was signed during the NESG period, and the disbursement has begun.”
Ajayi-Kadir emphasized that the funds would be allocated solely to registered members of the association, allowing for proper monitoring and accountability for every penny spent by the beneficiaries.
“With this approach, we will ensure transparency in how each member utilizes the funds. This financing will also contribute to the government’s economic stabilization plan,” he concluded. While the amount may seem modest compared to the damage inflicted by the current economic climate on the industry, Ajayi-Kadir expressed confidence that the funds would be used effectively.