Central Bank of Nigeria (CBN) disclosed at the weekend that from April April 2021, minimum capital requirements for microfinance banks (MFBs) would be reviewed upward.
In its 2020/2021 Monetary, Credit and Foreign Exchange Policy Guidelines issued at the weekend, the apex explained that from April, minimum capitalisation of Unit Tier I (One location urban) will become N200 million; Unit Tier II (One location rural) will move to N50 million; State MFB, N1 billion; while National MFB will be N5 billion.
It noted that loan portfolio of MFBs, would at all times, comprise a minimum of 80.0 per cent micro-loans.
The maximum loan by an MFB to any individual borrower, director or related borrower shall not exceed 1.0 per cent of the shareholders’ funds unimpaired by losses, while a maximum of 5.0 per cent is prescribed for corporate/group borrowers.
CBN called for structural reforms in the economy particularly in executing the much-delayed power sector recovery plan, implementing the financial inclusion strategy, and addressing infrastructure gaps remain essential to boosting inclusive growth
It also promised to sustain the Power and Airline Intervention Fund (PAIF) which was introduced to fast-track the development of electric power projects and the aviation sector of the Nigerian economy with the objective of improving power supply, generating employment, and enhancing the standard of living of Nigerians.
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