The Bank of Industry (BoI) has begun the disbursement of N15,000
TraderMoni loans to beneficiaries who have successfully paid back
their first N10,000 loans.
According to the bank, the disbursement was in response to the
increasing beneficiary repayments recorded under the scheme.
Through a flexible weekly loan repayment plan of N430 per week paid
over six months, the bank recorded high repayment of loans.
The BoI explained that the beneficiaries paid back by paying their
BOI-GEEP loan on the PayDirect available at commercial bank branches
across Nigeria and also through the purchase of repayment scratch
cards that can be procured from TraderMoni agents deployed across any one of 2,260 markets/cluster locations, a statement explained.
Indeed, available MSME data showed that even though small businesses
employ about 84 per cent of the labour force; contribute 50 per cent of the Gross Domestic Product (GDP),
access to funding that can move their businesses beyond the
MSME level to the Small/Medium Enterprise level remains limited.
In 2017, the MSME segment received a meagre 0.04% of all bank loans
originated in Nigeria.
To address the challenges and in recognition of the sheer
possibilities that the MSME sector holds for the economy; in 2016, the
federal government launched the Government Enterprise and Empowerment
Programme (GEEP).
“Through its signature products — MarketMoni, FarmerMoni, and
TraderMoni — the programme has reached over 1.5 million Nigerians
through small loans. These loans, starting from N10,000 up to
N300,000, have helped beneficiaries to transform their businesses.
“If these beneficiaries repay their first loan as promised, they
immediately qualify for the second level N15,000 loan. After repaying
the second loan, these beneficiaries will qualify for a N20,000 loan,
then N25,000 loan, and finally they graduate into the MarketMoni loan
program where they can get up to N100,000 in interest-free,
collateral-free loan. Through a gradual step by step process, these
MSMEs can grow and create jobs.
“This incentive-based model is working. Despite the fears of
traditional lenders on giving loans to MSMEs — in part due to lack of
formal identification, limited financial track record, and no
collateral — TraderMoni continues to achieve success with loan
repayments”, the bank explained.
Mrs Aishetu Adamu – a condiment and medicine seller at Bolori market
in Maiduguri, Borno State was one of the beneficiaries of the initial
loan of N10,000 that migrated to the next phase.
The statement quoted her to have said the initial loan was really helpful in promoting
her business.
Another beneficiary was Mrs Lucky Solomon, who revealed she was happy with
the improved profits she made from the first N10,000 loan she
received.
With that, she was able to repay the loan without delay and
opt for the next loan.
Aishetu and Solomon were part of the many beneficiaries in
Lagos, Osun, Kano and Borno who have paid back their first, and gotten
their second level loan amounts.
“Beyond providing loans for MSMEs, GEEP is focused on sustainably
boosting the MSME sector in an organised and effective manner. By
requiring that beneficiaries seeking higher loan amounts provide a
bank account (and BVN), the TraderMoniGEEP entrepreneurs will be on-
boarded into the formal financial services sector.
Consequently, these
beneficiaries will be able to expand their businesses in the medium to
long term; and this is already happening, one loan disbursement and
loan repayment at a time”, the bank added.
