THE National Co-operatives Financing Agency of Nigeria (CFAN) has lauded the waiving of guarantors for applicants of the Central Bank of Nigeria’s (CBN’s) N50 billion COVID-19 Targeted Credit Facility.
In an interview with the News Agency of Nigeria (NAN) in Abuja on Wednesday, the Executive Secretary of CFAN, Mr Emmanuel Atama, described the gesture as a welcome development, and a move that would boost productivity of small businesses in the face of the pandemic.
Atama, said that the development is aimed at encouraging small businesses, and commended CBN while noting that the waiver would also guarantee access to finance, which was a major requirement of financial inclusion.
He said: “It is a good development because when people have challenges such as this and the government comes to their aid through soft loans of this nature, it will help them to reactivate and come out strong after the lockdown.
“People should not abuse it so what it means is that they are solely relying on the capacity to pay.
“Before the gesture of the CBN, the issue of guarantor and collateral have affected people’s capacity to access loans.
“Now that there is a waiver, it is a straight road to accessing finance so, it is good and it will give free access to the fund and productivity of SMEs.
“When a loan is not secured by any form of guaranty, it is now relying on the ability to pay.
“I strongly believe that the loan will be given to people that have the capacity to pay back. What it means is that there are a lot of people that have capacity but didn’t have guaranty and collateral.
“This will give such people an opportunity to access the finance so the emphasis should be how genuine is their request and the capacity and cash flow of the business to make the required returns.”
The executive secretary said the CBN had also engaged members of the cooperative to ensure they had access to fund to stimulate inclusive growth and development in the country.
According to him, we have been up and doing creating access to land, input for our members and working together with the relevant authorities so that after the lockdown, we will not have food crisis.
The CBN had announced the waiver, saying it was to ease the concerns of those who had fulfilled all requirements for the loan but were yet to have their accounts credited.