Nigeria Approves 8 Microfinance Institutions
Wednesday, August 23, 2006
The Central Bank of Nigeria yesterday gave approval-in-principle to Accion, a United States-based microfinance company and seven others, including indigenous firms, to operate as Micro-Finance Banks (MFBs) in the country. Excerpt: The Central Bank of Nigeria (CBN) yesterday gave approval-in-principle to Accion, a United States-based microfinance company and seven others, including indigenous firms, to operate as Micro-Finance Banks (MFBs) in the country.
The other seven companies are Susu MFB, Lagos; Integrated MFB, Lagos; MIC MFB, Lagos; Osun State College of Technology (OSCT), Esa Oke, Osun; Wize Trade MFB, Lagos; Mustasons MFB, Lagos and; First Global MFB, Port Harcourt, Rivers state.
To secure the apex bank’s final approval, the newly licensed MFBs, shall be required to comply with conditions precedent to the commencement of operations, as contained in the regulatory and supervisory framework for microfinance banks in Nigeria, released in December 2005 and launched in January 2006 by President Olusegun Obasanjo.
Under the regulatory and supervisory framework for microfinance banks, the CBN stated that there shall be two categories of licences available for promoters (both local and foreign) of Micro Finance Banks based on geographical coverage.
The first category would be Micro Finance Bank licensed to operate as a unit bank (also known as community banks) and which shall operate and open branches within a specified local government area (LGA).
CBN said the minimum capital requirement shall be N20 million or such amount as may be prescribed by it from time to time.
The second category would be Micro Finance Bank licensed to operate in a State and open branches within a specified state or Federal capital territory and the minimum capital requirement of N1billion only is required or such an amount as maybe prescribed by the CBN from time to time.
