Senate has revisited an alleged uneven disbursement of intervention loans to the tune of N483 billion by development financial institutions among the six geo-political zones in the country.
The upper legislative chamber on Wednesday raised a seven-man ad-hoc committee to carry out a holistic investigation into the matter and report back in four weeks for further legislative action.
Chairman of the committee as announced by the Senate President, Godswill Akpabio is Senator David Umahi while Senators Babangida Oseni, Ali Ndume, Sani Musa, Tokunbo Abiru, Ipalibo Banigo and Chizoba Chukwu, would serve as members.
Resolution of the Senate followed the debate of a motion by Senator Ali Ndume (APC Borno South) which was supported by 64 other lawmakers on the need to holistically investigate the alleged disbursement of loans by Development Bank of Nigeria, DBN;
Nigeria Incentive-Based Risk Sharing system for Agricultural Lending, NIRSAL and related banks to micro, small and medium scale enterprises, MSMEs in Nigeria from 2015 to date.
Recalled the same motion by Ndume and three others was investigated by an ad-hoc committee in the 9th Senate and a report was submitted by the panel headed by Senator Sani Musa (APC Niger East).
Deliberating on the motion at plenary, the Senate noted that the huge disparity and uneven distribution of half a billion Naira to states in the six geo-political zones and the states in the country in 2021 by the Development Bank of Nigeria.
Ndume said “the bank’s Annual Integrated Statutory Report 2021obtsined on 13th July, 2022 from the organisation’s website showed that the bank disbursed a loan worth Four Hundred and Eighty Three Billion Naira (N483,000,000,000) only out of which only 11 percent went to the 19 states of Northern Nigeria, while 47 percent went to Lagos State alone.”
He also informed that the “13 percent of the loan that went to the North totals about about Fifty Three Billion, One Hundred and Thirty Million Naira (N53,130,000,000) while the 47 percent that went to Lagos State alone totals Two Hundred and Twenty Seven Billion and Ten Million Naira (N227,010,000,000) only.”
According to the breakdown of the loan presented by the lawmaker, “the South West got 57 percent worth N274,740,000,000; South South got 17 percent worth N81,940,000,000; North Central got 11 percent worth N53,020,000,000; South East got 9 percent worth N43,380,000,000; North West got 5 percent worth N24,100,000,000; North West and North East got just one percent worth N4,820,000,000.”
It would be recalled that the DBN exists to alleviate financing constraints being faced by MSMEs in Nigeria through providing finances, partial credit guarantees and technical assistance to eligible financial intermediaries on a market-conforming and fully financially sustainable basis.
Senator Ndume also noted that the top five sectors considered for the loan were oil and gas (42.0 percent), manufacturing (16.0 percent), agriculture, forestry and fisheries (7.2 percent), trade and commerce (6.3 percent), and transportation and storage (3.5 percent).
However, there was mild drama as senators took time to dissect the motion
Senator Seriake Dickson (PDP Bayelsa West) while suggesting an addition prayer asked that the ad-hoc investigation should be extended to look at all intervention loans by the Central Bank of Nigeria, CBN including COVID-19 palliative and Anchor Borrowers loan, among others.
But the additional prayer was dropped on the pretext that it would make the assignment of the ad-hoc committee unending.
Contributing earlier, Senator Orji Uzir Kalu (APC Abia North), said loans are gotten up in application and following satisfaction of requisite requirements including bank guarantees.
In his own, Senator Olamilekan Adeola (APC Ogun West) said Ndume had the notion that his North East zone was short- changed, but forgot that the development financial institutions had laid down procedures to disburse loans and appealed that the motion be given a second look if its sponsor felt bad about the facts.
But Senator Sani Musa (APC Niger East), who headed the former ad- hoc committee set up in the 9th Senate, said it should be noted that there is difference between bank loans and palliatives.
While agreeing that development institutions has criteria gor granting loans, he said the institutions might not be strictly followed, adding that 65 percent of loans disbursed by DBN has been repaid.
Senator Musa also said interest of Northerners in applying for the loan may be restricted by religious belief that no interest should be paid on loans while financial institutions take 17 percent on loan.
But Senator Ndume interjected, saying he perfectly understood workings of development institutions and their requirements, adding that he got information presented from the website of the DBN and microfinance institutions involved.
A financial expert and retired banker, Senator Isah Jibrin advised that the DBN among other institutions is not wholly Nigerian institution, but has foreign bodies like the World Bank and International Monetary Fund, IMF as investment partners and they have their criteria which cannot be compromised by the Nigerian system.
He advised that Nigerians who failed to meet such requirements should approach other less cumbersome institutions such as the Bank of Industry, BoI and Bank of Agriculture, BoA.
