Smedan Loan News to Specific Applicants
Smedan Loan News to Specific Applicants
SMEDAN requires N5 billion loan applicants to provide a CAC certificate
Smedan Loan: The Small and Medium Enterprises Development Agency of Nigeria has reconsidered the selection procedure for beneficiaries of an N5 billion credit facility designated for small firms in the country.
With the revised method, the agency has made the production of a Corporate Affairs Commission certificate and a Tax Identification Number a mandatory requirement for obtaining the loan.
Moshood Lawal, the Head of Corporate Affairs, disclosed this during an exclusive chat with our correspondent in Abuja on Wednesday.
According to The PUNCH, SMEDAN partnered with Sterling Bank last year to offer loans ranging from N250,000 to N2,500,000 at a 9% interest rate, promoting small business growth through improved financial access. The credit, which aims to aid over 10,000 Small and Medium Enterprises, has a 12-month lifespan, allowing small enterprises to fully exploit the facility.
During the signing event, SMEDAN DG Charles Odii characterized it as “an important milestone in our efforts to stimulate economic growth and drive prosperity by improving SME access to finance.” We believe that the financial assistance, which is available at a very competitive rate, will enable SMEs to grow operations, hire more staff, and contribute to an overall increase in beneficial trade and economic activity.”
However, in an update four months later, the spokesperson stated that a software application had been built to smooth the process and prevent human involvement, hence increasing the legitimacy of the process.
He also stated that submitting a CAC certificate and a tax identification number was required to identify fraudulent applicants and ensure that money was distributed to the correct individuals. He stated, “Concerning the N5 billion loan for small enterprises, we have developed an app that is currently ready.
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We are currently accepting entries via the software application. Everyone is expected to download it and fill out their business plan and other details. Then they would be evaluated using the app.
We had to go to an app to prevent human intervention because nearly everyone had a sibling who attempted to sway the outcome. Therefore, it is preferable to register through the application and upload the Tax Identification Number, a certificate from the Corporate Affairs Commission, and other required files. After that method is completed, the request will be reviewed, and qualified parties will receive a response right away; nevertheless, if the previous protocol had been followed, the outcome might have changed.
Additionally, we saw that the majority of candidates lacked their CAC certificate, even though it is a crucial document to present. Some people have disputed that they do not possess these certificates, but we have maintained that meeting this requirement is crucial for them to be approved for the loan. We intend to honor our pledge to be open and honest about our endeavor.
In response to a question on the status of applicants who had previously registered, Moshood clarified that for those applicants to be eligible for payment, they had to begin the application process anew using the recently created app.
“Everyone who applied for the grant the first time would have to do it again,” he said. They were merely instructed to register during the previous process and were not questioned seriously. However, this time, we are asking detailed questions about the money’s intended use and the monthly revenue of the business.
We will be able to distinguish between genuine and fraudulent businessmen using those questions. Over 200,000 small firms had previously expressed interest in obtaining the credit facility, and the bank had sent letters to successful candidates, as The PUNCH had exclusively reported.
The SMEDAN DG revealed that approximately three million businesses were lost in the last few years due to various factors like insecurity, fraud, global competitiveness, and lack of ease of doing business. This alarming rate of small-scale business mortality in the country has been a recurring issue.
Financial experts have stated that they believe that more small businesses will become major contributors to employment creation, economic advancement, and export expansion as a result of easier access to financing.
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