Nigerians Owe CBN N261.07bn COVID-19 Loan – Report

According to a recent report, some Nigerians who availed themselves of the Central Bank of Nigeria (CBN) and NIRSAL Microfinance Bank’s targeted credit facility (TCF) have defaulted on payments, leaving an outstanding debt of N261.07 billion out of the N419.42 billion disbursed.

Launched in April 2020, the facility aimed to mitigate the adverse effects of the COVID-19 pandemic on households and small and medium-sized enterprises (SMEs), as reported by Daily Trust.

The CBN disclosed in a document that the initiative contributed to the creation of 1,585,872 direct and indirect jobs, thereby positively impacting Nigeria’s employment sector.

Of the total amount disbursed, only about N41.39 billion has been repaid in principal, with interest repayments totaling approximately N174.60 million. However, there remains a substantial outstanding balance of approximately N378.03 billion, with N261.07 billion overdue, indicating significant challenges in repayment by a large number of beneficiaries.

The document revealed that while each of the top beneficiaries received N2.5 million for SME financing, most have been categorized as ‘non-performing’, except for Centriculture Limited, which has repaid N1 million and is classified as ‘performing’.

In response to these challenges, recommendations proposed include integrating the intervention into the Agri-Business/Small and Medium Enterprise Investment Scheme (AgSMEIS) for enhanced management and outcomes. Additionally, developing a clear exit strategy aligned with the outstanding balance is suggested to facilitate the smooth closure of the scheme.

Amidst these developments, the CBN reassured Nigerians that their funds deposited in banks are secure, emphasizing its commitment to safeguarding the financial interests of the populace.