SMEDAN signs Memorandum of Agreement with Microfinance Banks to grow SMEs
Small and Medium Enterprises Development Agency of Nigeria (SMEDAN), on Tuesday in Abuja, signed a Memorandum of Agreement with 15 Micro Finance Banks for the implementation of the One Local Government, One Product (OLOP) programme.
OLOP is SMEDAN’s flagship programme positioned to make significant contribution to the growth of the economy as well as in meeting the goals of Africa Continental Free Trade Area Agreement (AfCFTA).
Speaking at the signing of the Memorandum of Agreement with officials of the MFBs, the Director-General of SMEDAN, Dr Dikko Radda said that the project was to assist SMEs grow their businesses.
Radda, who expressed worry that a major challenge hindering the growth of SMEs was the lack of access to loans, urged the MFBs to ensure timely disbursement of money to grow businesses.
He reiterated SMEDAN’s commitment to drive the OLOP project in identifying a single product in one local government area and assist SMEs operators in form of cooperatives, with financial, technical and marketing support.
According to Radda, out of 774 LGAs, 364 LGAs have been covered from 2016 to 2020.
“In 2021 alone, 212 LGAs are expected to be covered, leaving a balance of 198 LGAs to be covered in 2022 to complete the first cycle.
“This year, we are targeting two cooperative societies per senatorial zone, making it six cooperative societies per state. The second cycle will commence in 2023 when we will revisit already visited LGAs,” he said.
While commending some cooperative societies for performing creditably, Radda expressed concern that difficult terrain in some rural LGAs affect selection, monitoring and evaluation.
He listed high cost of monitoring and evaluation, delayed documentation and poor due diligence by some participating MFBs as well as delayed disbursements as some of the challenges confronting the programme.
Radda also decried delay in loan repayment by some of the beneficiaries.
He urged the MFBs to ensure there was no unnecessary delay in disbursement or diversion of fund and that disbursements were made into the cooperate account of the cooperative societies.
Radda also tasked the MFBs to ensure that the cooperatives submit bankable business plans before disbursements were made.
Speaking on behalf of the MFBs, Mr Kayode Akinade, Managing Director, MICROVIS MFB, pledged that they would adhere strictly to the terms of agreement and ensure timely disbursements of funds to cooperative societies.
According to Akinade, the funds will be utilised for what they are meant for.
