First City Monument Bank (FCMB) Limited has again demonstrated its commitment to the growth of Micro, Small and Medium Scale Enterprises (MSMEs) in the country by disbursing additional funds totalling N122 million to such businesses.
Some of the latest beneficiaries include, Health Products and Farms Limited, Midows Limited (both based in Lagos); Everlasting Hands Limited, in Kaduna State, and God’s Will Technical Services Limited, Ogun State.
In August last year, the Central Bank of Nigeria (CBN) launched a N220 billion MSME Development Fund to provide loans at 9% interest rate and over a maximum period of five years. The scheme allows a SME businesses borrow a maximum of N50 million. FCMB is one of the deposit money banks partnering the CBN on the development fund.
As of February 2015, FCMB had disbursed N122 million to various SMEs. This figure is expected to grow in the coming months. MSMEs play a critical role in Nigeria’s economy, accounting for approximately 17 million micro businesses and 2 million SMEs, both contributing about 33 million jobs in the country.
As with many other parts of the world, SMEs face significant constraints in accessing finance and as a consequence attempt to source credit from other non-banking sources. According to a survey conducted by the World Bank in 2013, unfavourable interest rate was highlighted as one of the challenges faced by SMEs in accessing bank finance. In 2012, for example, the average interest rate on a SME loan across banks in Nigeria was about 24 percent.
In a statement, FCMB said its increased support to SMEs was in line with its value as a helpful bank and contribution to the success of such businesses considering the key role they play in driving national economic growth and the well-being of the people, especially in the areas of employment and poverty eradication.
According to George Ogbonnaya, group head, business banking of FCMB, the bank realises that SMEs play critical roles in the growth of the nation’s economy and as agents of growth, it is committed to helping these businesses thrive and contribute to the development of the country. He said “we understand that a number of factors combine to determine the success or failure of SMEs. We will continue to support our customers operating in the SMEs segment to overcome the challenges they usually face, especially at the take-off stage. We want to be part of their success story.’’
Ogbonnaya pointed out that with statistics showing that over 17million SMEs are registered in Nigeria and contribute significantly to the country’s Gross Domestic Product (GDP), FCMB realises the strategic importance of this sector. While reiterating the commitment of the Bank to ensure the successful disbursement and utilisation of the MSME fund, he urged operators in the SME business to avail themselves of the opportunities being provided by the Bank to boost their businesses.
Speaking on FCMB’s support to his business, Celestine Okolie, managing director of Everlasting Hands Limited, commended the bank for adding value to his firm, saying “I consider the fund from FCMB very okay to take my business to greater heights. The process of applying and accessing the money was very fast and easy. I appreciate the service I have enjoyed at FCMB.’’
Another beneficiary and managing director of God’s Will Technical Limited, Akeem Hassan, praised the Bank for putting in place an enabling environment for SMEs to access the fund. ‘’It was very easy and a seamless process to receive the amount I applied for,’’ he said. Messrs. Okolie and Hassan urged other SMEs, ‘’to show seriousness in the way they organise, manage as well as handle their documentations, while building and developing their businesses. The issue of collaterals should also be taken seriously.’’
Apart from the financial support to SMEs, FCMB has continued to implement various initiatives, including products and services, to further empower them in a sustainable manner. For instance, the Bank recently developed a product known as FCMB Business Account for SME businesses. This product comes with affordable account opening balance, with minimum operating balance of only N5,000, no limit to frequency of withdrawals as cheques are valid for clearing, apart from other very friendly features.
In addition, the bank has commenced an empowerment programme for operators of SMEs to enhance their financial, marketing and management skills under an initiative called Cluster Marketing. The exercise is aimed at equipping SMEs with the necessary skills they need to effectively operate, grow their businesses and bottom-lines. The pilot phase of this capacity building exercise kicked-off in Lagos recently and will last for five months after which it will be extended to other parts of the country for another eighteen months.
In the same vein, FCMB is set to aggressively support women managed businesses in line with the MSME fund scheme. To achieve this, the Bank is collaborating with women involved in SMEs for the provision of funding, sponsorship and advisory services.
FCMB is a member of FCMB Group plc, which is one of the leading financial services institutions in Nigeria with subsidiaries that are market leaders in their respective segments. Having successfully transformed to a retail and commercial banking-led group, FCMB expects to continue to distinguish itself by delivering exceptional services, while enhancing the growth and achievement of personal and business aspirations of its customers.
