CBN N5Billion 100 For 100 PPP Loan
Nigeria’s top bank, CBN, is pleased to raise public awareness of the federal government’s approach to 100 to 100 policy on Production and Productivity (PPP).
Apply CBN N5Billion 100 For 100 PPP Loan
The Central Bank of Nigeria (CBN) has launched the 100 for 100 Production and Productivity Policy (PPP) targeting private companies. Those who have a project to fund and under the scheme can apply up to N5 billion on the CBN application portal.
Once the bank has made sure that the private company can have a significant impact on the economy through “performance indicators (KPIs)”, the company will be selected. CBN will screen and finance eligible private sector companies in 100 days, and rollover every 100 days.
The initiative is designed to kickstart a sustainable economic growth trajectory, accelerate structural change, promote diversification and streamline the flow of finance and investment for enterprises capable of improving productivity.
This is a support for private sector companies aimed at reducing some imports, increasing non-oil exports, and improving the FX-generating capacity of the economy.
Objectives Of The Initiative;
The broader objective of this initiative is to reverse the increasing dependence of the country on imports by creating an ecosystem targeting and supporting projects capable of transforming and catalyzing the productive base of the economy.
The specific objectives include:
- catalyze import substitution of targeted commodities.
- increase local production and productivity.
iii. increase non-oil exports.
- improve foreign exchange earning capacity of the economy.
Key Performance Indicators;
Under the initiative, comprehensive, regular monitoring of specific criteria and key performance indicators (KPIs) will be carried out on a regular basis.
The KPIs (specific and relevant) shall include:
- % increase in production output of financed companies.
- % increase in capacity utilization.
iii. % increase in export volume and value.
- % decrease in import volume and value of industrial raw materials.
- Increase in the number of jobs created.
Focal activities will be existing businesses and projects (Brownfields) with the potential to transform and jumpstart the productive base of the economy, such as:
- Agriculture and agro-processing.
iii. Extractive Industries.
- Petrochemicals and Renewable Energy.
- Healthcare and Pharmaceuticals.
- Logistics Services and Trade-Related Infrastructure.
vii. Any other activities as may be prescribed.
Long-term loan for the acquisition of plant and machinery and Working Capital
Loans should be in excess of N5 billion. A budget of more than N5 billion would require special management approval.
The Rate Of Interest;
The interest rate under the intervention should not exceed 5.0%. (All-inclusive) By February 28, 2022, interest on the facility will be 9% per annum. Effective March 1, 2022 (all inclusive).
Loan Tenor And Moratorium;
The maximum term of term loans should be ten (10) years which will not exceed 31 December 2031 depending on the complexity of the project.
Each project will be assigned to the tenor in relation to its cash flow and lifetime of the underlying congenital.
Moratorium: Term loans shall have two (2) years moratorium.
The working capital facility will have a term of one (1) year with a maximum rollover of three (3) years.
The participating financial institution (PFI) will bear the credit risk.
Refinancing of existing facilities approved under the initiative, subject to management approval.
The collateral eligible under the intervention must be that which MFIs can accept under the RSSF-DCRR.
Repayment Of Loan;
Monthly interest on the facility will be amortized and transferred to CBN quarterly with default payments.
Participating Financial Institutions (PFIs);
Only CRR contributing Deposit Money Banks (DMBs) shall be eligible to participate under the initiative.
How To Apply CBN N5Billion 100 For 100 PPP Loan
Interested private-sector companies will submit their applications through their PFIs along with the required documents, which will include:
Detailed STATUS REPORT ON PROJECT’S capacity utilization, production output, productivity/efficiency level, employment level, export capacity, and value creation.
PROJECTED POST-FINANCING ECONOMIC BENEFIT of the project – increase in capacity utilization, production output, productivity/efficiency level, employment level, export capacity, and value creation after financing.
The LENDING BANK TO RECEIVE APPLICATIONS and carry out DUE DILIGENCE based on BUSINESS and CREDIT considerations.
Upon approval by the appropriate PFI’s CREDIT COMMITTEE, the lending bank shall forward applications of their eligible private sector companies to the CBN.
An APPLICATION submitted by the company’s promoters through a PFI seeking to be financed under the initiative.
Certified true copies of COMPANY REGISTRATION evidencing the incorporation of the Company with the Corporate Affairs Commission (CAC).
THREE (3) YEARS AUDITED FINANCIALS including the latest management account of the company.
At least TWO (2) CREDIT REPORTS of the company and the directors.
Business plan of the underlying project for which the facility is to be applied.
Applicant to notify CBN of a submitted application using this portal for the purpose of tracking and monitoring application status;
The successful beneficiaries would be published in National Dailies for Nigerians to verify and confirm with details of facility granted, operating sector, manufacturing activities financed, and PFI.
The CBN shall screen and finance eligible private sector companies in 100 days, and rollover every 100 days.
Central Bank of Nigeria shall conduct an internal review of the applications received to ensure compliance with the stipulated requirements for participation under the initiative
Submit an executive summary of your application via this portal. Central Bank of Nigeria shall conduct an internal review of the applications received to ensure compliance with the stipulated requirements for participation under the initiative.
The CBN shall release the approved sum to the PFI for onward disbursement to the selected private sector companies.