Micro, Small and Medium Enterprises Development Fund (MSMEDF) was launched  by Central Bank of Nigeria (CBN) on August 15, 2013, the funds totaling N220 billion is designed to be accessed directly from Participating Financial Institutions (PFIs) by MSMEs. The Fund prescribes 50:50 ratio for on-lending to micro enterprises and SMEs respectively by PFIs. In addition, 2% of the wholesale component of the Fund shall go to economically active persons living with disabilities (PLWD) and 10% provided for start-up businesses. The broad objective of the fund is to channel low interest funds to the MSME sub-sector of the Nigerian economy through Participating Financial Institutions (PFIs) to: Enhance access by MSMEs to financial services; Increase productivity and output of microenterprises; Create jobs and Engender inclusive growth.
The PFIs through which MSMEs will access the fund include; all Microfinance Banks, Non-Governmental Organizations-Microfinance Institutions (NGO-MFIs), Financial Cooperatives Finance Companies, Development Finance Institutions (DFIs) and Deposit Money Banks (DMBs). The Bank of Industry (BOI) and Deposit Money Banks (DMBs) shall participate only under the SMEs window.
Micro enterprises shall have a maximum loan tenor of one (1) year while SMEs shall have loan tenor from one (1) to five (5) years while moratorium will be negotiated. Principal and interest repayment for MSMEs loan shall be annually. The interest rate will be 9% per annum.
According to Development Finance Department of CBN, “Collateral requirement from start-ups by PFIs (DMBs and DFIs) shall be educational certificates such as SSCE, National Diploma (ND), National Certificate of Education (NCE), National Business and Technical Examination Board (NABTEB), Higher National Diploma (HND), University degree (NYSC Certificate where applicable) and a guarantor. The start-ups to access the MSMEDF must present their Bank Verification Number (BVN)”.
The structure and limits of loans that can be borrowed from PFIs are shown below;
Maximum Loan Limit (N)
SMEs (financed by NFBs & FCs)
SMEs (financed by DMBs & DFIs)
Eligible Enterprises
The following are eligible activities under the Fund:
·         Agricultural value chain
·         Cottage Industries
·         Artisans
·         Services
·         Renewable energy/energy efficient product and technologies
           Trade and general commerce
·         Other economic activities as may be prescribed by the CBN
Note: Nigerian Agricultural Insurance Corporation (NAIC) Insurance is compulsory for primary agricultural production.
Small & Medium Enterprises (SMEs)
·         Manufacturing
·         Agricultural value chain activities
·         Services
·         Renewable energy, energy efficient product and 
·         Technologies
·         Other economic activities as may be prescribed by the CBN
Equally, Special schemes or programmes on economic empowerment and grassroots development shall be eligible to access the Fund through PFIs.
It is important that borrower utilize the funds for the purpose for which it is granted, adhere strictly to terms and conditions of the fund and make record available for inspection.
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  1. Tamarabrakeami Abiri says:

    Am a vegitable farmer . i have done some planting of tomatoe, sweet corn, orange flesh sweet potatoe & cucumber, Please i need some asistance . I am from bayelsa state, under Ekeremor local goverment. Tamugbene.

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