CBN NGN50 Billion Facility for Households & MSMEs in Nigeria

Source: Lexology

The coronavirus (COVID-19) pandemic has resulted in disruptions to global supply chains, a sharp drop in global crude oil prices, turmoil in global stock and financial markets, massive cancellation of sporting and entertainment events, and intercontinental travel bans/restrictions across critical air, land and sea routes around the world. Across Africa, governments of African countries such as Nigeria, are taking proactive steps to constrain the spread of the virus by instituting partial or total lockdown within their jurisdictions. Households and micro, small and medium enterprises (MSMEs) are prone to be hard hit by the effect of the pandemic as businesses are literally ground to a halt. SMEs constitute about 90 percent of all the businesses in Nigeria.

In March 2020, the Central Bank of Nigeria (CBN), as part of the Federal Government’s intervention policy during COVID-19, released Guidelines for the Implementation of the NGN 50 Billion Targeted Credit Facility (the Scheme) aimed at providing succor to households and MSMEs that have been adversely affected by COVID-19. This commentary explains the content of the guidelines and the operational modalities for the Scheme.