Oyo state Commissioner for Budget and Economic Planning, Prof Musibau Babatunde has disclosed that the N500 million Small and Medium Scale Enterprise Loan Support under the Sustainable Action for Economic Recovery (SAfER) initiative is meant to cushion the effects of hardship induced by the removal of fuel subsidy.
Prof Babatunde said this when he led members of the SAfER sub-committee on a monitoring and evaluation visit to participating Microfinance Banks and some beneficiaries of the loan in Ibadan, Oyo and Ogbomoso zones of the state.
He said the SAfER SME Loan Support was introduced to support and boost small and micro business enterprises in the state and that under the loan scheme, N500 million was disbursed to partnering Microfinance Banks across the seven zones of Oyo State “to support and boost SME, which is the baseline for economic activities in the state and to bring succour to the residents during this economic hardship.”
Prof Babatunde who also doubles as the Chairman of the SAfER Small and Medium Enterprises (SME) sub-committee noted that SAfER as introduced by Governor Makinde, has proved to be a master stroke towards helping individuals and households in the state become stronger financially.
“The Federal Government removed the subsidy for gasoline products and also unified the exchange rate and that led to the devaluation of the naira. These two policy shocks actually affected the general price level, as inflation shot up; and the exchange rate of the naira to the major currencies in the world depreciated to a very large extent”, he said.
Prof Babatunde added, “The interest rate was increased to stabilise inflation and as a result of that, an economic crisis ensued and it has affected the people of the state especially business owners”.
“Governor ‘Seyi Makinde, in his wisdom, felt that there was the need to make a conscious attempt to actually help and enhance the activities of small and micro enterprises in Oyo State. This was how the SME Pillar under the SAfER programme came about.
“We went through the whole procedure, made it a single digit interest loan so that it is accessible and also the term of accessing was actually made flexible for the beneficiaries across the seven SME-supporting Microfinance banks in the seven geo-political zones of Oyo state.”
He stressed that the monitoring visit was to enable the committee to assess the level of operations of the Microfinance banks and their compliance with the operational framework guiding the disbursements of loan to the beneficiaries, since the state government had disbursed the loans in three tranches to the participating banks,
Emphasizing that the loan is without collateral and that the beneficiaries have a three-month moratorium before the commencement of repayment, Prof Babatunde expressed satisfaction on the repayment turnout of the beneficiaries, while he also assured applicants waiting to benefit from the laudable scheme that it would soon get to them.