London, Oct. 31, 2017 (AltAfrika)-Amidst growing concern over dwindling oil revenue in Nigeria, the Central Bank of Nigeria (CBN) has increased the maximum financing of project in the non-oil sector to N5 billion per project under the Non-Oil Export Stimulation Facility (NESF).

The facility is also to attract a single digit interest  rate of 9 percent per year .The amount would represent 70 per cent of the verifiable total cost of the project, with one-year moratorium and a tenor of up to 10 years, not exceeding December 31, 2027.

For entrepreneurs to access the fund, which is available in race against 2027 deadline, the apex bank yesterday, unveiled a guideline for the intervention. To those in search of working capital or stocking facility, there shall be provision for one year with the option of roll-over, especially in construction project, subject to the approval of the CBN.

However, banks would have the right to charge their prevailing interest rates on the amount in default for loan repayment of principal and/ or interest by the borrower.

The apex bank said the NESF was introduced to help diversify the revenue base of the economy and expedite the growth and development of the non-oil export sector.

The scheme is aimed at improving access for exporters to concessionary finance to expand and diversify the non-oil export baskets; attract new investments and encourage re-investments in value-added non-oil exports production and non-traditional exports.

It will also shore up non-oil export sector productivity and create more jobs; support export-oriented companies to upscale and expand export operations as well as capabilities; and broaden the scope of export financing instruments.

Meanwhile, banks and development finance institutions have already been told to support the initiative, as failure to disburse funds to the borrower within the period agreed in the loan agreement shall attract a penal charge of the maximum lending rate for the period that funds were not disbursed.

Also, failure to remit principal and interest to the CBN shall attract a penal charge of the maximum lending rate for the period that funds were not remitted, while non-rendition of returns or the rendition of false returns shall attract the penalty stipulated by section 60 of the Banks and Other Financial Institutions Act (BOFIA).

The fund would also be available for loan syndication among banks, but through the lead bank, which shall submit application on behalf of other banks, while all correspondence with respect to the application shall also be through the lead bank.

According to the guideline, an export-oriented enterprise is eligible to participate if it is duly incorporated in Nigeria under the Companies and Allied Matters Act (CAMA) and has verifiable export off-take contract(s), among others.

(The Guardian)