Senate probes N500bn loan disbursement

By on November 17, 2022 0

The Senate on Wednesday set up an ad hoc committee to investigate the alleged unequal disbursement of a half-trillion naira loan to the six geopolitical zones by the Development Bank of Nigeria.

The planned investigation by the Red Chamber followed resolutions passed by the Red Chamber on a motion sponsored by Senator Ali Ndume (APC Borno South) and co-sponsored by Senator Ibrahim Bomai (APC Yobe South).

The Senate therefore set up a seven-man committee to survey the disbursement of the fund in the six geopolitical zones and report back in two weeks.

The committee which will be headed by Senator Sani Musa (APC Niger East), includes Senators Ibrahim Danbaba (APC Sokoto South), Ayo Akinyelure (PDP Ondo Central), Mathew Urhoghide (PDP Edo South), Ali Ndume (APC Borno South) , Lilian Ekwunife (PDP Anambra Central) and Sadiq Umar (APC Kwara North) as members.

Senator Ndume, in his remarks before the Senate, said: “The bank’s 2021 annual integrated statutory report obtained on July 13, 2022 from the organization’s website; the bank was only able to disburse a loan worth N483,000,000 of which only 11% went to the 19 northern states of Nigeria while 47% went to Lagos State alone.

“The 11% of the loan that went to the North totals around N53,130,000,000 and the 47% that went to Lagos State alone only totals N227,010,000,000.”

Ndume further expressed concern that “loans were extended to the six geopolitical zones, where data showed that the South West took the lion’s share with 57% of the total loan, estimated at about 273,740,000,000 naira only”.

He also feared that “the South-South had gained 17%, or about N81,940,000,000; the Federal Capital Territory and North Central gained 11% or N53,020,000,000; South East accessed a measly 9% or around N43,380,000,000; the North West, which accessed 5% of N24,100,000,000, while the North East only accessed 1%, the lesser share of the total loan at around N43,820,000,000 only.

According to him, the DBN exists to alleviate the financing constraints faced by micro, small and medium enterprises in Nigeria by providing financing, partial credit guarantees and technical assistance to eligible financial intermediaries in a compliant and fully financially viable market. .

He noted, however, that lack of knowledge of the existence of the loan or even the DBN, religious beliefs that prevented Muslims from taking interest-bearing loans, and lack of business formalization, could have hampered disbursement.