By Chinwendu Nnadozie , Independent Online –

Niger State government has spent over N1.5 billion to facilitate establishment of Microfinance banks in all 25 local government areas of the state.

Director General of the state’s Small and Medium Scale Enterprises and Microfinance Agency, Alhaji Mohammed Ali Baba, disclosed this in Minna.

He said the gesture was part of the administration’s strategy to fast-track development and reduce poverty among rural dwellers.

The government decided to facilitate establishment of the microfinance banks in local government areas as part of its commitment to encourage small and medium-scale industries and reduce the rate of unemployment.

Part of the funds disbursed to the local governments, according to him, are for logistic and equipment for take-off of the grassroots financial institutions aimed at stimulating commercial activities in rural areas.

The director general also explained that each microfinance bank in the councils was expected to have an initial capital of N20 million to guarantee stability.

Alhaji Baba Ali said the state government decided to embrace establishment of microfinance banks to replace the community banking scheme, which could not stand the test of time due to liquidity problem so as to protect low income earners.

On sustainability of the scheme, the director general said government as co-investor in the banks had a role to play by complementing the Central Bank of Nigeria (CBN) and the National Insurance Development Corporation supervisory function towards ensuring that personnel that would man the banks are qualified.

He therefore, appealed to host communities of the new banks to support the initiative by patronising the outfits so as to uplift their economic status considering the essence of the programme, which, among others, is to empower the communities particularly the youth.

“The government decided to evolve a more practical approach to alleviating poverty and fighting hunger, and the scheme is part of the present administration’s poverty reduction programme of emancipating the people,” the director general said.