Banks agree to dedicate 5% of profit to agriculture, SMEs
Banks in Nigeria have unanimously
resolved to dedicate five per cent of profits declared every year to the funding
of agriculture and small scale businesses.
Speaking to journalists at the
end of the Bankers’ Committee meeting of the Central Bank of Nigeria (CBN) last
week, Mr. Ahmed Abdullahi, CBN’s Director of Banking Supervision, disclosed
that banks have agreed to release five per cent of their profit after tax (PAT)
to provide equity funding for agriculture related businesses and small scale ventures.
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| Mr. Godwin Emefiele CBN Governor |
Abdullahi who disclosed that the
banks also resolved to set up a central repository to check fraud in the
banking system added that the CBN has enough funds to sustain its current
intervention in the foreign exchange (forex) market.
He said, “The recent development
in the forex market has led to prices trending downwards. The positive effect
of that is that we have seen inflation trending downward. There is a focus
that, by the second quarter of this year, the economy will be out of recession.
The CBN has the arsenal in its war chest to sustain what is happening in the
forex market.
“That is why the CBN set up new
windows: there is a window for SMEs, where small businesses will have access to
forex through their banks with minimum documentation. There is need for members
of the public to know of the existence of these windows for SMEs owners to draw
from it to promote their businesses.
“There is another initiative: the
investor exporter window, where it will be willing buyer, willing market
window, where prices will be determined purely by market forces. And it is a
window that will allow investors to come in and trade their forex at a price
they consider appropriate. With the present convergence of the rates, confidence
is going to be rebuilt. In order to build confidence further, that is why we
have this window to allow inflow of forex.”
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