The Small and Medium Enterprises Development Agency of Nigeria (SMEDAN) has signed a Memorandum of Understanding (MoU) with Sterling Bank to support 10,000 Small and Medium Enterprises with the sum of N5 billion at single-digit interest rate of 9% to boost their businesses.

The Memorandum of Understanding (MoU) which was signed on Wednesday at the SMEDAN Corporate Headquarters in Idu, Abuja between the Director General of SMEDAN and the Managing Director/CEO of Sterling Bank, Mr. Abubakar Suleiman, has a budding period of 2 months before the application process will commence.

Speaking at the signing ceremony, the SMEDAN DG, Charles Odii who stated that one of his cardinal point is to democratise access to finances for SMEs says finances are scare and must be plugged wherever they are available.

“We intend to make access to finance easier. We’re going for the partnership because finance is scarce and anywhere you see finance, go for it but be careful.
N5bn at single digit interest rate will give close to 10,000 SMEs access to viable this financing for their business.

“We believe that the financial support, which comes at a very competitive rate, will help SMEs expand operations, hire additional employees, and contribute to an overall upswing in beneficial trade and economic activities,” Odii said.

In his response, the Managing Director of Sterling Bank, Mr. Abubakar Suleiman, said the partnership with SMEDAN was done to provide prompt access to finance for small businesses and guide them through a formalization process crucial for sustainability and access to funds. This includes record-keeping, separation of personal from business finances, and investment in competitive strategies to stand out and succeed.

“This loan faculty is the private sector solution to help grow the SMEs .When SMEs come in and they have access to this low interest rate finance at 9 per cent, it will serve as a springboard to the success of their businesses”.

The ₦5 billion loan agreement with Sterling Bank has a duration period of 24 months, and repayment will commence after a minimum period of three months, enabling small businesses to fully leverage the facility. The Application for the loan through the portal will commence and disbursement is expected to begin in two weeks.

Small businesses are expected to complete the application virtually after which the bank will process the application for disbursement. The SMEs loan will be granted to a tune ranging from ₦250,000 to ₦2,500,000 and without any collateral.

Recall that SMEDAN recently had an agreement with the Anambra State government by to provide a 1 billion naira loan portfolio for small businesses in the state. The Director-General assured of his plans to announce more partnerships with other state governments and private actors in pursuit of the goal to enhance access to finance for small businesses.