RSSF: Nigeria's central bank slashes intervention rates to boost SMEs' access to finance
It has released new guidelines for its Real Sector Support Fund (RSSF).The Central Bank of Nigeria (CBN) released on March 3rd new guidelines for its intervention fund in a bid to boost access to finance for small and medium-sized enterprises (SMEs).
It has reduced its intervention rates to banks from three to one per cent, which is expected to encourage banks to make use of the Real Sector Support Fund (RSSF) to lend more to small businesses.
The decision to lower rates comes after the CBN realised that many banks weren't using this fund because the three percent rate was not enticing enough to cover the risks of lending money to SMEs, Ventures reports.
The RSSF was set up in 2015, with a capital of N300 billion (€1.4 billion), to lend money to SMEs in sectors such as manufacturing, mining, and agriculture, with loans going from N500 million up to a maximum of N10 billion.
The CBN has also set up in August 2014 the N220 billion Micro Small and Medium Enterprises Development Fund, which was designed to provide funds for small enterprises, especially businesses owned by women.