2020 CBN AGSMEIS, MSMEDF and other Federal government 5% loan

CBN loan for Covid 19


This article will take you through the process to apply for the 2020 CBN AGSMEIS, MSMEDF and other Federal government 5% loan in Nigeria. All this no collateral loan with low interest rate is made available for Micro Small, Medium Enterprise by Federal government to ensure access to finance for Small and Medium Enterprises (SMEs).

Objectives of the 2020 CBN AGSMEIS, MSMEDF loan

  • To ensure Small and Medium Enterprises (SMEs)have access to finance
  • To generate much-needed employment opportunities in Nigeria
  • To develop agricultural value chain and ensure sustainable agricultural practices.
  • To boost the managerial capacity of Agri-Business/SMEs as pipelines of growing enterprises that can become huge corporate organizations.

2020 CBN MSMEDF Federal government 5% loan in Nigeria

What is CBN MSMEDF

The CBN launched the MSME Development Fund on August 15, 2013 with a share capital of N220 billion. The Fund was established in recognition of the significant contributions of the Micro, Small and Medium Enterprises (MSME) sub-sector to the economy and the existing huge financing gap.

Ten (10) percent of the Fund has been devoted to developmental objectives such a grants, capacity building and administrative costs while ninety (90) percent commercial component will be released to Participating Financial Institutions(PFIs) at 2% for on-lending to MSMEs at a maximum interest rate of 9% per annum.

Eligible activities to be financed include agricultural value chain, services, cottage industries, artisans, trade and commerce and any income generating business as may be prescribed by the CBN from time to time.

What categories of entrepreneurs can apply for the Fund?

(a) Micro entrepreneurs (i. e. borrowers seeking loans of less than N500,000) are to approach any of the four institutions:
* Microfinance Banks          * NGO/Microfinance Institutions
* Financial Cooperatives    * Finance Companies

(b) Small and Medium Enterprises (SMEs) (i.e. prospective borrowers seeking between N500, 000 and N50million) are to approach any of these institutions:

Deposit Money Banks

Bank of Industry (BOI)

Bank of Agriculture)

Who are the Participating Financial Institutions?

The PFIs under the Fund are as follows:
Micro borrowers (N500,000 to N5,000,000) would approach:

  • Microfinance Banks
    • NGO-Microfinance Institutions
    • Finance Companies
    • Financial Cooperatives

SME borrowers (N5,000,000 to N50,000,000) would approach:

  • Deposit Money Banks and Development Finance Institutions (Bank of Agric and Bank of Industry)

What are the activities that can be financed under the Fund?

  • Agricultural value chain activities,
    • Manufacturing & Cottage Industries,
    • Artisans,
    •  Services,
    • Trade and general commerce,
    • Renewable energy or energy efficient products and technologies, and
    • Any other income generating projects as may be prescribed by the CBN.

2020 CBN AGSMEIS Federal government 5% loan in Nigeria

What is AGSMEIS?

Agricultural Small and Medium Enterprises Investment Scheme (AGSMEIS)

is an initiative of the Bankers’ Committee in a bid to support and complement the Federal Governments’ efforts at promoting Agri-businesses/Small and Medium Enterprises as a vehicle for sustainable economic development and employment generation.

AGSMEIS is a voluntary initiative of the Bankers’ Committee approved at its 331st meeting held on 9th February, 2017. The Scheme requires all banks in Nigeria to set aside 5% of their profit after tax (PAT) annually.

The initiative is to support the Federal Government’s efforts and policy measures for the promotion of Agricultural Businesses, Small and Medium Enterprises (SMEs) as vehicles for sustainable economic development and employment generation.

Sectors that are Eligible for this AGSMEIS loan

The following sectors listed below are eligible for this loan

  • Agricultural businesses,
  • Education,
  • Health,
  • Services (Hospitality, Restaurants, Catering, Services, etc),
  • ICT,
  • Manufacturing/Production,
  • Mining,
  • Creative Industry (Fashion, Design, Crafts, Entertainment, etc),
  • etc

CBN AGSMEIS Loan can be accessed by following the process below

Interested applicant must have been trained by an Entrepreneur Development Institute (EDI)

Interested applicant will apply for loan via an EDI

Development of Business plan for the loan

The applications will then be sent to CBN for processing

Applicants will be called for an interview regarding his/her business.

Those qualified will be contacted and given the loan.

Fill clearly the new form with all the details required , sign and get them authenticated by EDC – http://www.edcsouthwest.org/

Note:

Maximum loan is 10million;

 Interest rate is 5% per annum;

Tenor is 7 yrs and

Moratorium is 18 months.

Requirements for CBN AGSMEIS Loan Approval

The following are the Requirements necessary either during application or before final approval of the CBN loan application and final disbursement of funds to an applicant.

  1. Registered business with CAC
  2. Evidence of tax payments
  3. BVN
  4. Letter of Introduction
  5. Letter of Guaranty
  6. Certification by an EDI
  7. Passport photo of you and guarantor
  8. Valid ID card

Guidelines to develop your Business Plan

Our organization has setup business plan template of more than 30 different businesses on our server to guide youths on developing their application

Click on the link below for the business plan

http://www.solarexinstitute.com.ng/category/business-plan/

And the other 2 links below will guide you on how to develop your own executive summary and financial plan

For further information click on the link below

https://www.cbn.gov.ng/

For further enquiries

Call 07062284261, 07082014770