By Clive Mphambela, Zimbabwe Independent EMPLOYEES in the microfinance sector will now be able to enjoy pension benefits upon retirement following the approval by the Insurance and Pensions Commision (Ipec) earlier this month for the setting up of a Micro Finance Industry pension fund, businessdigest can reveal. Cavport Consultants MD Emmanuel... 

By Clive Mphambela, Zimbabwe Independent

EMPLOYEES in the microfinance sector will now be able to enjoy pension benefits upon retirement following the approval by the Insurance and Pensions Commision (Ipec) earlier this month for the setting up of a Micro Finance Industry pension fund, businessdigest can reveal.

Cavport Consultants MD Emmanuel Matina, whose company is the employee benefits consulting firm behind the setting up of the MFI Pension, said the scheme was licenced by Ipec on May 2 2013 following the registration earlier on April 24 of a trust deed to govern the operations of the Fund.

Under Zimbabwean laws, a pension fund must set up a trust deed to be administered by a properly balanced board of trustees which must comprise trustees elected from both employee and employer representatives from the participating employers as well as independent trustees drawn from relevant professional fields.

The MFI Pension Fund has already appointed to its board lawyer Advocate Taona Sibanda and Kotsai Makamure, a chartered accountant.

Bankers George Nachamba and Agnela Mavhunga as well as investments practitioner Andrew Masuwa have also been proposed to the board of trustees as independent trustees, while an additional three trustees will be drawn from employer organisations.

At least 15 registered micro finance companies, led by industry leader FMC Financial Services, have come together for the ground breaking industry initiative.

There are 54 registered microfinance institutions and more than 150 money-lending companies. The combined workforce is estimated at more than 3 000 employees.

Datvest Asset Mangement are the asset managers, while Cavport are the fund administrators. Chartered Accountants firm, Grant Thornton, are the appointed independent auditors of the fund.

According to Matina, the rules of the fund have been drawn up and it should start accepting member contributions by July 1.

The fund has been set up as an umbrella fund on a defined contribution basis.

Zimbabwe Association of Pension Funds (Zapf) chairman, Francis Masukusa, said the development was welcome as the new scheme was going to contribute to the growth of the pensions industry and the national savings base. He said the MFI sector was growing and it made perfect sense for the industry to set up its own pension fund.
“Firstly, I must applaud the players in the industry who have taken this important step.

Employees in most of the microfinance companies in the sector have been previously excluded from pension arrangements by virtue of the small size of the employer organisations, who typically have ten or less employees,” he said.

Masukusa said the scheme had the advantage that it would cater for industry specific needs such as early exit arrangements or higher contribution levels to compensate for the shorter working careers.
According to Masukusa, the MFI Pension fund would be covered by an umbrella policy, with each individual pensioner having his or her own accumulation account.

James Msipa, managing director of Quest Financial Services, one of the first MFIs to join the pension scheme, said the MFI Bill being presently debated in parliament was going to usher in a new era in the MFI space and consequently the industry has to position itself as an employer of choice.

“Employees will now be able to feel comfortable to start a career in microfinance and continue until retirement, knowing fully well that they and their families are covered even after they die,” he said.
Msipa said employers would benefit as they would now haveleverage to retain key skills, adding the quality of their business would now improve.

“Previously MFIs were unable to retain high skills for very long.
The offering of pension benefits will go a long way in closing the gap between employers in the mainstream banking sector and the MFI sector. This development also affirms that the sector is maturing and taking itself and its employees seriously and this will augur well for the growth of the sector,” Msipa said.

“From a global perspective this is a first umbrella scheme of its kind and firmly puts Zimbabwe’s MFI sector on the map as highly organised.”

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Microfinance companies, under the Bank of Ghana’s new regulated licensing regime, offer both lending and deposit products to their clients. In the past year, about 100 firms have received full operational license. Over 400 others have provisional license to serve the needs of the unbanked population. Players in the sector are upbeat about prospects... 

Microfinance companies, under the Bank of Ghana’s new regulated licensing regime, offer both lending and deposit products to their clients.

In the past year, about 100 firms have received full operational license. Over 400 others have provisional license to serve the needs of the unbanked population.

Players in the sector are upbeat about prospects to create jobs and provide financial intermediation in poverty alleviation. But all is not well in the fast-growing industry.

Petty trader, Umar Moro Abubakari opened a savings account in the ‘Daakye’ (future) product of Graford Microfinance Limited in Kumasi, in his bid to save to pursue higher learning.

Trusting in the firm’s provisional license, he managed to save GH¢810 over an eight month period. But he’s losing all his money.

“I went to my bank to withdraw my money but I didn’t get my money; they’ve closed the bank and I don’t know why”, Umar Moro complained. “I’m worried because I want to go to IPMC, so I was thinking that I’ll use that money to pay for my bills”.

Like Umar Moro, frustrated clients of microfinance firms in distress have been frequenting police stations, media houses and other places to seek help in accessing their savings.

Incidents of firms closing down and bolting with depositors savings have been reported in most parts of the country, including the Ashanti, Brong Ahafo, Western and Volta regions.

“We are in crisis but does not mean that we’ve collapsed and this is not new in the banking system”, admitted a manager of one of the firms, in response to the fate of his clients in getting their money.

Checks indicate some of the big microfinance firms are struggling to stay in business.

“We started with some companies that are no more with us; some have gone through assessment by the regulator, some have even received their provisional licenses but you see them collapsing”, observed Collins Amponsah Mensah, National Chairman of the Ghana Association of Microfinance Companies (GAMC).

Greed, irresponsible and reckless operations as well as poor management of depositors’ funds have been identified as the bane of the microfinance industry.

Sources say some of the seemingly booming firms use multi-branching as a deceptive ploy to attract clients and investors with a credible image. In some instance, the firms have managed to open more than 10 branches in less than one year.

When faced challenges in managing their growing branches, the companies go into liquidity distress. One firm in the Ashanti region is reported to be indebted to the tune of over GH¢10 billion.

In these instances, the monitoring role of the Central Bank has been questioned. “Why should the Bank of Ghana allow the unbridled opening of additional branches?” queried one industry operator, who expects the regulator to be bold in ensuring firms with additional branches recapitalize.

There is also the trend of microfinance operators venturing vehicle hire purchase schemes, with the attendant problems of their inability to sustain the vehicle distribution to customers who have deposited huge sums of money.

Kwame Sarpong Osei-Bonsu of the Banking Supervision Department of the Bank of Ghana acknowledged the Bank has had several complaints, which he says are under investigations.

Unfortunately, depositors with these financial institutions have no safety nets when such businesses collapse.

“There have been talks of bringing in Deposit Insurance Scheme as we have in other countries like US and UK and even Nigeria; once you’re a regulated entity, then you go into that scheme and that guarantees a person that if something goes wrong they’ll get their money back”, noted banking consultant, Nana Otuo Acheampong.

The GAMC is already thinking in that direction, in addition to establishing a Deposit Security Fund to serve as secondary reserve for members.

Whilst financial consumers are protected with the deposit insurance, the Fund, as a liquidity buffer, will aid in the management of deposit liabilities of industry players, explained Mr. Amponsah-Mensah.

“We’re going to mandate our members to deposit an amount each day out of their mobilization into that account; it will be invested, then anytime that there is pressure on them, they can fall on that deposit to free themselves from the pressure”, he said.

Presently, the credible microfinance firms are experiencing high withdrawal rate as clients take precautionary measures to protect their savings.

This is a worry to the GAMC. Mr. Amponsah-Mensah is therefore prevailing on the Bank of Ghana to empower the Association to play a key role in regulation, if the industry is to avoid a bubble.

“If the regulator is unable to enforce the rules and regulation that goes with the regulation itself, our hands will just be tied behind us. So that is why we’re working together with the regulator to ensure that whatever we say should be done under the regulation, operators are complying”, stated the GAMC Chair. “If we take away non-compliance, we should expect the system to collapse one of these days”.

SOURCE: Myjoyonline

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Micro finance institutions are not double taxed as has been claimed, the Rwanda Revenue Authority has said. Richard Tusabe, the Rwanda Revenue Authority deputy commissioner, said the issue of value added tax (VAT) being levied on both leased equipment (generally at customs) and on payment of rentals by the lessee, which microfinnce banks considered... 

Micro finance institutions are not double taxed as has been claimed, the Rwanda Revenue Authority has said.

Richard Tusabe, the Rwanda Revenue Authority deputy commissioner, said the issue of value added tax (VAT) being levied on both leased equipment (generally at customs) and on payment of rentals by the lessee, which microfinnce banks considered as double taxation, is a misunderstanding.

“There is no double taxation because when leasers are setting the amount of monthly rentals (price) to be paid by lessees, normally, they should not include the amount of VAT paid during acquisition of the leased asset since they recover that VAT when they submit their returns. That VAT input is offset from the output VAT,” Tusabe, who is also in charge of domestic customs, explained.

The Association of Microfinance Institutions of Rwanda (AMIR) over a month ago complained to the Prime Minister that huge taxes, including double taxation on some products, were making the cost of loans, especially on leased assets, very expensive.

Tusabe noted that because the issue was not about the law but rather the challenges that emanate from its implementation, the revenue body and the Private Sector Federation (PSF) would soon convene a meeting with all the actors in the leasing business to explain how VAT should properly be charged on leased assets.

The Association of Microfinance Institutions of Rwanda (AMIR) argues that according to the law, a lease loan is viewed as any other service loan and therefore subjected to an income tax of 30 per cent.

The association wants the loan to be considered as any other loans since the group supports mostly the unbanked and the neglected segment of the population.

“We have been engaging the Rwanda Revenue Authority through PSF about the matter, but all they have told us is that 18 per cent income tax on collateral will be refunded with no interest at the time of declaring returns. But this is unfair considering that they refund it after three or so months without interest,” Damascene Hakuzimana, the Association of Microfinance Institutions of Rwanda communications officer, said in an interview with Business Times.

“We are here to ensure that poor people, who don’t have collateral can access loans, but this is becoming hard for us. In fact, the drive to increase access to finance and fight poverty is being compromised,” Hakuzimana noted.

New micro finance institutions are exempted from paying corporate tax for the first five years of operation.

In a recent meeting with the business community, the Prime Minister Piere Damien Habumuremyi, directed the tax body to engage them and find a solution within two weeks (which have since elapsed).

Tusabe said apart from the misunderstanding on how the lease tax should be applied, micro-finance institutions have not raised any other serious tax issues with the tax body.

SOURCE: The New Times

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The Economic and Financial Crimes Commission, EFCC, on Friday arraigned the Company Secretary of E-Barclays Micro Finance Bank Limited, Abuja, Oby Onwukeme before the Federal High Court, Abuja on a one-count charge of obstructing justice. Mrs. Onwukeme was alleged to have willfully declined to furnish the Commission with account information of... 

The Economic and Financial Crimes Commission, EFCC, on Friday arraigned the Company Secretary of E-Barclays Micro Finance Bank Limited, Abuja, Oby Onwukeme before the Federal High Court, Abuja on a one-count charge of obstructing justice.

Mrs. Onwukeme was alleged to have willfully declined to furnish the Commission with account information of one of her customers, Paulinus Enendu of Pamadas and Sons Limited who was being investigated for obtaining money under false pretence and issuance of dud cheque to the tune of N4.2 million.

She had, despite repeated appeals and citing of Section 38 (2) (a) of the EFCC Establishment Act which relates to the crime of obstruction, maintained that her client’s lawyer wrote and informed her not to disclose the information to the Commission.

The charge reads; “that you Oby Onwukeme being the Legal Adviser and Company Secretary of E-Barclays Micro Finance Bank Limited on or about the 21st day of January, 2013, at Abuja, within the jurisdiction of the Federal High Court of Nigeria, did willfully obstruct the officers of the Economic and Financial Crimes Commission in the exercise of their powers to seek and receive information on Account Number 4010074168 belonging to Pamamdas & Sons Limited, and thereby committed an offence contrary to Section 38 (2) (a) and punishable under Section 38 (2) (b) of the Economic and Financial Crimes Commission (Establishment) Act 2004”.

She, however, pleaded not guilty prompting the prosecution counsel, Maryam Ahmed to ask for a date for trial.

However, counsel to the accused person, C.O Achilike presented an oral bail application which was not opposed by the prosecution.

The judge, Adeniyi Adetokunbo, granted the accused person bail on self recognition, but stated that she must produce two passport photographs, an ID card and an undertaking signed by the Managing Director of E-Barclays Microfinance Bank, Kingsley Onuorah, to produce her when needed by the court.

The judge adjourned the case to July 8 and 9.

SOURCE: Premium Times

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Professor Stephen Addai, former Rector of Ghana Institute of Management and Professional Studies (GIMPA) on Wednesday expressed displeasure about Bank of Ghana’s regulation concerning operation of micro finance. He noted that BoG’s requirement that a minimum capital of GH¢100,000.00 or GH¢60,000.00 be deposited by microfinance... 

Professor Stephen Addai, former Rector of Ghana Institute of Management and Professional Studies (GIMPA) on Wednesday expressed displeasure about Bank of Ghana’s regulation concerning operation of micro finance.

He noted that BoG’s requirement that a minimum capital of GH¢100,000.00 or GH¢60,000.00 be deposited by microfinance companies is not very appropriate.

Prof Addai, who was speaking during the inauguration of the Ghana Chamber of Business and Industries (GCBI) in Accra, noted that such directives would compel microfinance institutions in villages to operate underground and dubiously as they might not have the basic requirement.

“It’s interesting to note that one would not need even GH¢10,000.00 to operate a microfinance institution in a village like ‘Hwiremoase,’ but the BoG’s genuine attempt to weed out unscrupulous microfinance companies is also driving many small scale operators to work secretly and also charge more interest,” he said.

He cited the neglect of the Small and Medium Enterprises (SMEs) as one of the major reasons Ghana was not experiencing the necessary growth despite the production of numerous natural resources.

Prof Addai said one of the fastest ways Ghana could grow its economy, increase employment, and provide sustainable livelihood is to stimulate the SME sector and make it a main stream target of government policies and programmes.

“In fact Government relegates SME issues on the back burner evidenced by under resourced, poorly managed and corrupt prone units under the Ministry of Trade and Industries,” he said.

He said Ghana ran on the backs of SMEs adding that just about 10 per cent of Ghanaians had anything to do with big banks and savings and loans companies as they deal basically with money lenders or microfinance companies.

Prof Addai who is also a Professor of Economic and Leadership at the Pentecost University, expressed shock at Government’s inability to appoint someone to handle issues relating to SMEs due to their contribution to national growth.

He urged Government not to bureaucratise SME issues, but rather empower institutions like Empretec and Business Departments of Polytechnics to handle them with ease on its behalf.

Registration of SMEs should be so simplified that it could be done at the district level as they would only be paying local taxes and not national ones, he said.

Prof Addai urged operators of SMEs to endeavour to undertake feasibility studies before they start businesses to reduce risks, and keep records to know how their businesses fair.

Mr Bernard Brock Nii Arku Yartey, Founder, GCBI said the Chamber, which was incorporated in January 201, is a non-profit organisation with members who are Ghanaians and foreign companies doing business in Ghana.

“GCBI is aimed at providing members and SMEs a unique source of contacts and updated information about businesses in Ghana.

“The loan unit is the main avenue meant for the opening of 92 branches across the country,” he added.

Mr Arku Yartey said GCBI is made up of board of directors, advisory council, council of elders, research team, members and units that would help steer the affairs of the organisation and be a bedrock for SMEs in their daily activities.

Madam Sylvia Lutterodt, Secretary General of UNESCO who officially launched GCBI said collaboration with the Chamber is due to the education platform it offers Ghanaians.

She said the launch signified GCBI readiness to help solve problems of SME’s and all unemployed in the country.

Source: GNA

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Professor Stephen Addai, former Rector of Ghana Institute of Management and Professional Studies (GIMPA) on Wednesday expressed displeasure about Bank of Ghana’s regulation concerning operation of micro finance. He noted that BoG’s requirement that a minimum capital of GH¢100,000.00 or GH¢60,000.00 be deposited by microfinance companies... 

Professor Stephen Addai, former Rector of Ghana Institute of Management and Professional Studies (GIMPA) on Wednesday expressed displeasure about Bank of Ghana’s regulation concerning operation of micro finance.

He noted that BoG’s requirement that a minimum capital of GH¢100,000.00 or GH¢60,000.00 be deposited by microfinance companies is not very appropriate.

Prof Addai, who was speaking during the inauguration of the Ghana Chamber of Business and Industries (GCBI) in Accra, noted that such directives a compel microfinance institutions in villages to operate underground and dubiously as they might not have the basic requirement.

“It’s interesting to note that one would not need even GH¢10,000.00 to operate a microfinance institution in a village like ‘Hwiremoase,’ but the BoG’s genuine attempt to weed out unscrupulous microfinance companies is also driving many small scale operators to work secretly and also charge more interest,” he said.

He cited the neglect of the Small and Medium Enterprises (SMEs) as one of the major reasons Ghana was not experiencing the necessary growth despite the production of numerous natural resources.

Prof Addai said one of the fastest ways Ghana could grow its economy, increase employment, and provide sustainable livelihood is to stimulate the SME sector and make it a main stream target of government policies and programmes.

“In fact Government relegates SME issues on the back burner evidenced by under resourced, poorly managed and corrupt prone units under the Ministry of Trade and Industries,” he said.

He said Ghana ran on the backs of SMEs adding that just about 10 per cent of Ghanaians had anything to do with big banks and savings and loans companies as they deal basically with money lenders or microfinance companies.

Prof Addai who is also a Professor of Economic and Leadership at the Pentecost University, expressed shock at Government’s inability to appoint someone to handle issues relating to SMEs due to their contribution to national growth.

He urged Government not to bureaucratise SME issues, but rather empower institutions like Empretec and Business Departments of Polytechnics to handle them with ease on its behalf.

Registration of SMEs should be so simplified that it could be done at the district level as they would only be paying local taxes and not national ones, he said.

Prof Addai urged operators of SMEs to endeavour to undertake feasibility studies before they start businesses to reduce risks, and keep records to know how their businesses fair.

Mr Bernard Brock Nii Arku Yartey, Founder, GCBI said the Chamber, which was incorporated in January 201, is a non-profit organisation with members who are Ghanaians and foreign companies doing business in Ghana.

“GCBI is aimed at providing members and SMEs a unique source of contacts and updated information about businesses in Ghana.

“The loan unit is the main avenue meant for the opening of 92 branches across the country,” he added.

Mr Arku Yartey said GCBI is made up of board of directors, advisory council, council of elders, research team, members and units that would help steer the affairs of the organisation and be a bedrock for SME’s in their daily activities.

Madam Sylvia Lutterodt, Secretary General of UNESCO who officially launched GCBI said collaboration with the Chamber is due to the education platform it offers Ghanaians.

She said the launch signified GCBI readiness to help solve problems of SME’s and all unemployed in the country.

SOURCE: GNA

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By Yinka Kolawole, Vanguard The need to adopt the principles of microfinance has been advocated in the quest by government to provide affordable housing for low-income earners in the country. Managing Director of LAPO Microfinance Bank, Mr. Godwin Ehigiamusoe, alluded to this in his presentation at a housing exhibition recently held in Abuja.... 

By Yinka Kolawole, Vanguard

The need to adopt the principles of microfinance has been advocated in the quest by government to provide affordable housing for low-income earners in the country.

Managing Director of LAPO Microfinance Bank, Mr. Godwin Ehigiamusoe, alluded to this in his presentation at a housing exhibition recently held in Abuja. Speaking on the topic, “Achieving affordable housing: Creating 500,000 housing units by 2016 through housing microfinance”, he noted that traditional mortgage practices do not take care of low-income people.

Microfinance basically entails the provision of financial services to micro-entrepreneurs and small businesses, which lack access to banking and related services due to the high transaction costs associated with serving these client categories. The two main mechanisms for the delivery of financial services to such clients are: relationship-based banking for individual entrepreneurs and small businesses; and group-based models, where several entrepreneurs come together to apply for loans and other services as a group.

Ehigiamusoe asserted that much like microfinance, affordable housing is about liberalising access to mortgage and also the possibility to use flexible structures and processes to achieve mass housing targets on a sustainable basis. He noted that housing is required by the poor because it is a basic human need. Also, because among the poor, there is strong connection between the home as a place of shelter or as a means for engaging in income generating activities.

The LAPO MfB boss said that the targets of affordable housing are ready clients, customers and members of microfinance institutions, such as MfBs, Cooperatives and NGOs. “These people organisations have developed flexible and responsive structures and procedures that could be useful for providing mass housing facility.

MFIs are already active in provision of houses to low-income people across developing nations such as Bangladesh, India, Kenya, Bolivia and Mexico.” He identified challenges of housing microfinance to include policy and regulatory constraints, lack of funding, and inadequacy capacity. According to him, a major constraint is the regulatory definition of micro-loans in terms of volume and tenor, adding that housing loans are usually of larger sizes and of longer tenor.

Ehigiamusoe said the challenge of lack of funding is two-dimensional – the volume of funds required for housing is not available to microfinance banks as they have limited options for deposit mobilisation; and the problem of asset-liability mismatch that will arise when housing microfinance is provided by MfBs.

On inadequate capacity, he noted that there is a lack of awareness on technical skills required for providing housing microfinance in the country. “Like microfinance, affordable housing for the poor will require flexible and responsive strategies which differ from the formal mortgage practices. It takes time and resources to build the required competences.”

He called for a review of the microfinance supervisory guidelines that will recognise the roles that microfinance banks can play in provision of mass housing and review size and tenor of micro-loans. On the issue of funding, Ehigiamusoe recommended the establishment of funding linkages between microfinance banks and cooperatives on the one hand, and commercial banks on the other and also called for the inclusion of mass housing loans into the proposed micro and small enterprise development fund by the Central Bank of Nigeria (CBN).

In addition, he emphasised the need for technical support for microfinance banks and cooperatives. “The soft technology of mass housing is reaching maturity in other countries and regulatory jurisdictions, and Nigerian microfinance banks can learn from the experiences. Technical assistance focus should be on mobilization of potential beneficiaries, need assessment, and structuring of loans and repayment schedule,” he stated.

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STERLING, Va., April 26, 2013 /PRNewswire via COMTEX/ — Members of the Milepoint frequent flier community have teamed up with the nonprofit Zidisha Microfinance to raise over $1 million in charitable microloans for disadvantaged, internet-savvy individuals in the world’s poorest locations. Zidisha is the world’s first direct... 

STERLING, Va., April 26, 2013 /PRNewswire via COMTEX/ — Members of the Milepoint frequent flier community have teamed up with the nonprofit Zidisha Microfinance to raise over $1 million in charitable microloans for disadvantaged, internet-savvy individuals in the world’s poorest locations.

Zidisha is the world’s first direct person-to-person lending service to offer direct interaction between individual lenders and borrowers across the international wealth divide. Zidisha offers a Facebook-style social networking platform that allows lenders to interact directly with individual borrowers in Kenya, Senegal and other developing countries. Lenders and borrowers use the platform to negotiate credit terms, or simply to share stories and converse about their lives.

Unlike the well-known microfinancing website Kiva, there are no intermediary organizations between the lender and the borrower. Eliminating intermediaries brings down the cost of loans dramatically, enabling borrowers to offer interest to lenders while still paying far less than the cost of traditional microfinance loans.

Milepoint members have found in Zidisha a new way to leverage their affinity for reaching out across geographic barriers to make a positive social impact. Members of the frequent flier community have become Zidisha’s largest lending group, lending over $115,000 to developing country entrepreneurs through the Zidisha.org website.

“From Milepoint we have learned that direct contact is a gift not only when we travel, but in our charitable endeavors,” says Randy Petersen, Milepoint’s founder. “And Zidisha allows us an even more direct form of communication in helping others. Zidisha for us is a new form of pen pals for the future and with this channel of charity it brings giving to a personal level.”

Learn more:

Zidisha Microfinance website: www.zidisha.org

Milepoint website: www.milepoint.com

SOURCE Zidisha Microfinance

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By Bassey Udo, Premium Times Nigeria The minister emphasised the need to provide an enabling environment for rural businesses. The Minister of State for the Federal Capital Territory, Olajumoke Akinjide, on Thursday, asked providers of financial services to get their services to the vast majority of the un-serviced entrepreneurs, particularly... 

By Bassey Udo, Premium Times Nigeria

The minister emphasised the need to provide an enabling environment for rural businesses.

The Minister of State for the Federal Capital Territory, Olajumoke Akinjide, on Thursday, asked providers of financial services to get their services to the vast majority of the un-serviced entrepreneurs, particularly rural dwellers, the aged, socially excluded groups ,and the youth in the country.

The minister was speaking at the commissioning of the Kwali Micro-Finance Bank located in the Kwali Area Council Secretariat- a fulfillment of the promise by the Federal Capital Territory Administration to encourage financial services to micro, small and medium enterprises (MSMEs).

The Kwali Micro-Finance Bank commenced operations with a paid-up capital of N120 million.

The minister stated that the Abuja Administration was committed to ensuring the provision of enabling environment for residents of rural communities in the area for the support of their businesses in order to achieve self-reliance and economic emancipation.

“There is need to promote financial inclusion services for MSMEs and indeed the culture of micro credits and savings in Nigeria. Needless to emphasize that lack of access to finance and enthronement of necessary globally acceptable standards pose serious threat to economic growth and development,” Ms. Akinjide said.

“It is on this premise that the FCT Administration set out to encourage the establishment of Micro Finance Banks in the six Area Councils of the FCT with the Abuja Enterprise Agency (AEA) as promoters,” she added.

She described the AEA as the FCT’s vehicle for wealth creation, employment generation, poverty eradication and value reorientation with a mandate to ensure business growth within the Territory and advised that the system of financial exclusion and low level of bank penetration in Nigeria should be tackled head-on.

“Needless to remind that inadequate funding of MSMEs affects positive economic growth. The FCTA is committed to the expansion of Kwali Micro-Finance Bank to all the Area Councils of the FCT to ensure easy access to financial services for our business operators.

“We are positioned to encourage value addition and linkages and ensure the establishment of business clusters, trade zones and business incubators in the FCT,” she added.

The Managing Director of AEA, Aisha Abubakar, explained that the need to promote business growth and economic empowerment in the six area councils informed the establishment of the micro-finance bank.

“The establishment of Kwali Micro-Finance Bank is targeted at micro enterprises in underserved communities to promote community development. It aims to deliver friendly, flexible and enduring capital access to credit and other financial services for the benefit of all segments of the population at affordable costs to the customers,” Ms. Abubakar stated.

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The Kaduna state Industrialization and Micro-Finance Board said it is set to disburse the sum of N400 million to small scale businesses in the state as part of its renewed vision and strategies to create employment for the people in the rural areas. Addressing participants at a microfinance intervention brainstorming workshop organized for small scale... 

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