President Goodluck Jonathan has inaugurated Development Bank of Nigeria with a capital base of $1.5bn (about N300bn).
According to the President, the bank will support medium to long-term lending to Micro, Small and Medium-scale Enterprises, with duration of up to 10 years and a moratorium period of up to 18 months.
The bank is being supported by development partners such as the African Development Bank, World Bank, Agence Francaise de Development, and KFW Entwicklungsbank of Germany.
The federal government is projecting that the bank will assist in creating one million direct jobs with each MSME creating an average of five new jobs.
The Minister of Finance, Dr. Ngozi Okonjo-Iweala also explained that about 20,000 beneficiaries would be offered loans in the first one year of the bank’s operation.
She said “I share in the President’s belief that the most valuable change we can make as a government is ensuring that we break this jinx so that small businesses can actually have a full-fledged institution that will provide this access.
“Not just access, but access in a manner that does not stifle them, but instead grows them; access that gives them space to afford a decent life, while nursing their businesses; access in a manner that will not take substantial portions of their profits away from them; access to the sort of finance that empowers them and their communities.
“Simply put, access to credit means financial inclusion; financial inclusion helps convert people’s dreams to reality. This is the reason why we are here today, this is the reason why the President is also here to launch the flagship bank that gives all Nigerians a chance not only to dream, but to also see that the dream becomes a reality.”
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