The Bauchi State Government has commenced the implementation of its Microcredit Revolving Loan Scheme to empower farmers, women, youth and persons with special needs across the 20 local government areas of the state for poverty reduction.
The Director General of the State Agency for Sustainable Microfinance, Nura Muhammad DanMadami, who disclosed this to journalists in Bauchi, said the establishment of the Microcredit Revolving Loan Intervention Scheme is part of the state government’s efforts towards reducing poverty and improving the livelihoods of the poor and vulnerable groups in the state.
Nura Danmadami said that the purpose of the credit scheme was to empower the poor and vulnerable people with particular emphasis on women, youth and persons with special needs and explained that targeted beneficiaries of the revolving loans are those that operate small business enterprises but does not have access to credit from formal financial institutions to enable them to start up and upscale their businesses for improved livelihood and poverty reduction.
“The main objective of the MIFIN Revolving Loan is to promote access of the poor to credit facilities, strengthen microfinance institutions operating in the state, increase small business activities and generate employment, and ensure financial inclusion for the unserved poor people.
“Eligible borrowers of this scheme shall be registered Microfinance Institutions (MFIs) operating within Bauchi State, that are willing and capable of partnering with the Bauchi State Government on the Microfinance Institutions Building Programme for poverty reduction intervention programme. “Such partnering Microfinance institutions must demonstrate the capacity to manage the credit facility in terms of ensuring its disbursement to the intended target beneficiaries through sound documentation, monitoring and mechanism for the recovery from a minimum of 5 Village Savings and Loans Associations (VSLAs) to a maximum of 10 VSLAs per borrowing cycle.
“Eligible beneficiaries must be recognized as Village Savings and Loans Associations (VSLAs) with a fixed number of members not exceeding 25 persons and have successfully completed two VSLA cycles. Only members who are on the register of members of an eligible VSLA at the commencement of the scheme (1st Cycle) would be qualified for lending under the scheme.
“The State Government’s Microfinance Institutions Building Programme for Poverty Reduction (MIFIN) is a deliberate strategy for empowering Microfinance institutions by providing them with capital, skills and networks. “The MIFIN programme operates on the premise that if the capital, and skills constraints of MFIs are addressed significantly, they will be able to perform their role of financial intermediation effectively and by extension, reach out to the deserving poor and provide them sustainable access to financial services to boost their income.”
The DG also revealed that qualified Microfinance Institutions under the MIFIN programme will, in addition to having access to capital for on-lending, will further benefit from training and capacity building aimed at deepening their knowledge and also strengthening their roles of financial intermediation for optimal performance.
While applauding the magnanimity of Governor Bala Mohammed for the gracious approval to commence the implementation of the MIFIN program of the Agency, Nura Danmadami implored all registered MFIs to obtain the guideline or reach out to the Agency for further details on how to key into the program.
In a keynote address, the State Commissioner for Budget and Economic Planning, Aminu Hammayo said the implementation of the scheme would go a long way in complementing the efforts of the present administration in tackling poverty thereby promoting sustainable business and investment opportunities.
“I want to congratulate the Agency for this wonderful initiative and I urge all stakeholders in the implementation of the project to give their maximum support for effective service delivery.”