The Central Bank of Nigeria said it would disburse N50bn to households and small and medium scale enterprises as a way of support to cushion the economic impact of COVID-19 on businesses.
A group, Social Action, has faulted the Nigerian Government's COVID-19 economic package on the grounds that it excludes the informal sector from accessing the loan.
The Central Bank of Nigeria said it would disburse N50bn to households and small and medium scale enterprises as a way of support to cushion the economic impact of COVID-19 on businesses.
In a statement on Thursday, Social Action said the requirements stipulated in order to access the loan will marginalise and exclude business owners in the informal sector.
The statement reads, “The structure, guidelines and conditionalities for target beneficiaries seem to negate the very stated objectives of the facility.
“The CBN guidelines for the implementation of the credit facility released on 23 March 2020, the scheme focuses on households or enterprises with verifiable evidence of livelihoods adversely affected by the COVID-19 pandemic. While proof of registration and existence as a business is imperative for accessing such credit, specific requirements in the CBN guidelines would result in the exclusion of the vast majority of Nigerians that operate in the nation’s thriving informal economy.
"The CBN set unduly overbearing collateral requirements for obtaining the loan. Collateral requisitions such as “movable assets, title documents and deed of debenture” before the loan can be assessed negate the spirit of the intervention.
“Such a requirement will limit the ability of small enterprises to access as the majority of micro-businesses cannot provide these requirements.”
The group therefore called on government to intervene where lapses exists in order to ensure that Nigerians, who are hardest hit by the economic impact of Coronavirus, benefit from the stimulus package.