The Central Bank of Nigeria has increased the size of the Targeted Credit Facility (TCF) to accommodate more beneficiaries and cushion the negative impact of COVID-19 on more households and small and medium enterprises.
The Central Bank of Nigeria (CBN) said the increase of the credit line is to accommodate more beneficiaries as it has plans to reach more small businesses and households that are deeply affected by the negative effect of the global health pandemic.
According to CBN Governor, Godwin Emefiele, in a report titled “Response by the Monetary and Fiscal Authorities to COVID-19” which was released by the apex bank, TCF funds has started disbursement through the NIRSAL Microfinance Bank.
Emefiele explained that N149.21 has been disbursed to 319,869 beneficiaries, and also acknowledge the success and positive contributions of the program on the growth output and added that the apex bank has decided to increase the fund from N150 Billion to N300 Billion.
The credit was disbursed according to industry size, cash flow and operational activities of beneficiaries. Eligible households have access to a maximum of N3 million, while small business beneficiaries can access a maximum of N25 million.
The Apex Bank Governor said “the increase is to accommodate many more beneficiaries and boost consumer expenditure which should positively impact output growth.
“Given the impact on COVID-19 on key economic variables earlier mentioned, the fiscal and monetary authorities took unprecedented measures to prevent any long-term damage to the growth prospects of our economy”.
He further explained that the apex bank has agreed to extend the moratorium on principal repayments of CBN intervention funds by one year and also granted banks regulatory order to restructure credits given to sectors that were adversely affected by the global health pandemic.
He also said that CBN has strengthened the Loan to Deposit ratio policy, and this has resulted in a significant rise in loans provided by financial institutions to banking customers.
“Total gross credit rose by over 21 percent over the past year, from N15.5 trillion to N19.54 trillion. The apex bank, he added has also disbursed Agri-Business/Small and Medium Enterprise Investment Scheme (AGSMEIS) (N92.90 billion to 24,702 beneficiaries), Anchor Borrowers Program (ABP) by the sum of N164.91 billion to 954,279 beneficiaries,” he said.
CBN said it has also extended credit to manufacturers for manufacturing-related activities to keep their operations running amidst the pandemic.
“The Agricultural sector continued to record positive growth supported by productivity gains in the sector, interventions by the government, and improved demand for local produce. The Manufacturing Purchasing Managers Index, in the month of November, stood at 50.2 points, indicating an expansion in manufacturing activities after six months of contraction”, he added.
