Manufacturers bemoan structural framework challenges of CBN’s critical sectors intervention loan

By Joy Obakeye

Manufacturing companies have lamented over difficulties faced in accessing the Central Bank of Nigeria’s (CBNs) five per cent lending rate intervention scheme loan for manufacturing and other critical sectors.

According to them, the loans have structural framework problems and are almost never accessed in banks at five per cent. They added that banks were more open to giving manufacturers loans at their official market rates.

The Chairman of Manufacturers Association of Nigeria’s Electrical/Electronic sectoral group, Mrs Ijeoma Oduonye, who made the disclosure, said efforts made by her firm towards accessing the intervention funds through one of its designated commercial banks had proved abortive, DailyTimes gathered.

She said, “Before now, we tried to work through one of the banks, but it didn’t materialise, now we are talking with another bank. It is a sector intervention fund that was going for nine per cent before but now they brought it to five per cent. But we as a company have not accessed it because the commercial banks we wanted to process it in could not process it.

“I do not understand the details from their end. I don’t know the regulation between the bank and the CBN. But the bank told my firm they won’t be able to process it. Ordinarily, commercial banks would prefer you use their funds, it is at a higher interest rate.”

Also, the Sectoral Chairman of the Manufacturers Association of Nigeria’s Gas users and the Executive Director of Haffar Industries, Michael Ola-Adebayo, said that the structural framework of the CBN intervention leading has complexities that limit manufacturers from accessing them through the designated commercial banks.

He said, “We have not been getting the loans. Has any manufacturer been borrowing this money? The commercial banks have not provided the facility to borrow money at five per cent, or even 10 per cent.

According to a media report, the CBN agreed to leave interest rates at five per cent per annum for critical sectors and manufacturing industries until March 2023.

This decision followed the resolution of the Monetary Policy Committee (MPC) to increase the benchmark interest rate to 13 per cent from 11.5 per cent.

READ ALSO: EFCC declares Christ Embassy Pastor Miebi Bribena.

Meanwhile, the communications department of the apex bank on several occasions explained that more than N1trillion has been disbursed under the intervention scheme for the manufacturing sector and others.

The department had stated that over N1trillion has been disbursed under the Differentiated Cash Reserve Requirement.

Although, there are indications that the manufacturing firms that might have been unable to obtain funds through the scheme were not able to pitch convincing proposals on the projects that the funds would be used for.