The National Association of Microfinance Banks (NAMB), the umbrella body of registered microfinance banks in the country, has unveiled to float a Special Purpose Vehicle (SPV) with a view to pooling funds for its members in their drive towards improving the financial inclusion agenda of the monetary and fiscal authorities.
The proposed SPV is a self-help approach initiated by the association to create a pool of fund for its members in the face of growing challenges they are currently grasping with in terms of financial inadequacy.
Giving this hint exclusively to Brtnews.ng in Abuja, the President of the association, Mr. Rogers Nwoke, said that NAMB intended to collaborate with the Central Bank of Nigeria (CBN) and some development banking institutions in order to achieve the objectives of the SPV.
Nwoke, who is also the Managing Director/Chief Executive Officer of HASAL Microfinance Limited, explained that there was a growing need to create an investment platform where investors will feel comfortable to put money and the association can on-lend to our members to create adequate liquidity in the MFB sub-sector of the financial services industry.
He clarified further: “We are floating a Special Purpose Vehicle (SPV) to attract wholesale funds so that somebody who wants to put money in the banks will no longer concentrate on the big people because you can give money to the platform and we take the risk at giving such money to people. So, we can have this platform with the CBN for MSMEs Fund.
“We can approach BoI, we can approach DBN to say you can give us money which is managed by professionals fund managers. It is also going to be a platform where MFBs that have surplus can provide the surplus for the platform to lend and ensure such credits are secured. We want to create adequate liquidity in the MFB sub-sector”, the NAMB President added.
Expatiating on the constraints affecting most MFBs in the country, the seasoned bank identified un-level playing ground as one of the key problems NAMB members face in that even micro depositors or clients are putting their money in Deposit Money Banks (DMBs) that cannot support them.
According to him, the irony of the system is that liquidity is channeled to the DMBs while the MFBs who give micro credits do not get the deposits, adding that to deal with hurdles being faced by most MFBs, that imbalance needs to be corrected.