Okpanachi Says Credit Guaranty Scheme Underway For DBN Institutions

In a bid to expand the scope of access to credit especially on its platform, the Development Bank of Nigeria, DBN, would be setting up a subsidiary to undertake credit guarantees for participating financial institutions, PFIs.

Meanwhile, the bank, in its first year of operations, exceeded its projected performance with a total loan disbursement of N31.36 billion to 35,000 Micro, Small and Medium Enterprises (MSMEs) in Nigeria.

Disclosing these at a media parley in Lagos, the Managing Director of DBN, Mr Tony Okpanachi, said the aim of the credit guarantee scheme is also to de-risk the MSME sector while establishing a risk sharing arrangement with PFIs up to 50%. The scheme, according to him, would eventually create a critical mass of MSME lending in the economy.

The scheme, according to him, would eventually create a critical mass of MSME lending in the economy. Hitherto, groups in the Nigerian MSME space have alleged that most of the intervention funds raised by some government institutions amount to hundreds of billions of Naira are not disbursed and Vanguard investigations reveal that the institutions involved, including commercial banks, hold back the funds claiming that the MSMEs are too risky to take the credit facilities.

Photo Caption: Managing Director of DBN, Mr Tony Okpanachi