CBN Reveals Steps to Access the 500 Million Naira Creative Industry Funding Initiative – Nairametrics

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The Central Bank of Nigeria (CBN) finally unveiled the stages and modalities of access to funds under the Creative Industries Finance Initiative (CIFI), which will allow businesses to access loans up to 500 million naira.

The Central Bank disclosed this in a circular published Thursday and addressed to all deposit banks in Nigeria. According to the CBN, the new modalities of access to the initiative consist in officially launching the implementation of the funding program for the creative industry.

The Committee of Bankers had previously disclosed while revealing the pattern that the decision to support the creative industry was born out of the committee’s conviction that the sector holds the key to job creation, poverty reduction and inclusive growth.

Funding of the Initiative: The Central Bank also revealed that the program will be financed by the Small and Medium-sized Agricultural Enterprise Investment Program (AGSMEIS), an initiative of the Bankers Committee with a carefully appropriated N22.9 billion seed fund. .

Here is a breakdown of how funds are allocated to the individual business unit:

  • Student software development loan – N1 billion
  • Information Technology – 5.5 billion naira
  • Film production – N3 billion
  • Film distribution – N4 billion
  • Music – 5.4 billion naira
  • Fashion – N4 billion

[ALSO READ: Access Bank Plc opens window for N20bn credit facility]

How to access loans: The Central Bank has highlighted the main characteristics and modalities of each category of activity. Below is a breakdown of all the details required for loans by business unit:

1. Student software development loan: For a student software development loan, the sum of 3 million naira is accessible to each interested candidate.

  • It is accessible with an interest rate of 9% per year.
  • The tenor is three years old.
  • The repayment plan is monthly.
  • The moratorium is 9 months from the date of disbursement of the loan.
  • To be eligible for this, some of the required security arrangements include a university certificate, NYSC certificate, credible guarantor, and personal guarantee.
  • Other requirements include admission to a training organization with an employment contract, no bad credit history with a bank, and a preference for areas with low IT penetration.
  • The financing structure is the minimum 30% equity contribution and 70% of the deposit money 70% bank loan
  • The source of reimbursement is from the proceeds from the sale of software or from the use of patents.

[ALSO READ: CBN Unveils the Creative Industry Financing Intiatives]

2. Film production: N50 Million can be viewed by anyone interested.

  • An interest rate of 9% per year
  • The tenor is 10 years old.
  • The repayment plan is quarterly.
  • The moratorium is 24 months from the date of disbursement of the loan.
  • The main requirement includes a minimum equity contribution of 30%, a legal mortgage, a debenture of all assets, a credible guarantor and a personal guarantee.
  • Other conditions are at least three years of relevant experience, no credit history with any bank, and a preference for areas with low cinema penetration.
  • The financing structure is the minimum equity contribution of 30% and 70% of the deposit money Bank loan.

3. Film distribution: The sum N500 Million can be viewed by every interested company.

  • An interest rate of 9% per year
  • 10 years repayment
  • The repayment plan is monthly
  • The moratorium is 24 months from the date of disbursement of the loan
  • The main requirements include a minimum equity contribution of 30%, a legal mortgage, a debenture of all assets and a personal guarantee.
  • Other conditions are at least three years of relevant experience, no bad credit history with a bank and a preference for areas with low cinema penetration
  • The financing structure is the minimum equity contribution of 30% and 70% of the deposit money Bank loan

4. Mode: This involves the purchase of equipment and rental / service charges.

  • 9% interest rate per year
  • The tenor is 10 years old.
  • The repayment plan is quarterly.
  • The moratorium is 36 months from the date of disbursement of the loan.
  • The security arrangement includes a minimum 20% capital contribution, a mortgage bond, a local mortgage, and a lien on trade stock and equipment items.
  • The other conditions include at least three referrals from sponsors or recognized organizations or associations. Minimum of three years of relevant experience and no bad credit history with any bank.
  • The financing structure is the minimum equity contribution of 20% and 80% of the deposit money Bank loan.
  • The source of reimbursement is the company’s product.

5. Information technology: This involves the purchase of equipment and rental / service charges.

  • 9% interest rate per year
  • The tenor is 10 years old.
  • The repayment plan is quarterly.
  • The moratorium is 36 months from the date of disbursement of the loan.
  • The security arrangement includes a minimum 20% contribution, a mortgage debenture, a local mortgage and a lien on trade stock and equipment items.
  • The other conditions include at least three referrals from sponsors or recognized organizations or associations. Minimum of three years of relevant experience and no bad credit history with any bank.
  • The financing structure is the minimum equity contribution of 20% and 80% of the deposit money Bank loan.
  • The source of reimbursement is the proceeds of sales or the income from the services provided.

6. Music: It also involves the purchase of equipment and rental / service charges.

  • 9% interest rate per year
  • The tenor is 10 years old.
  • The repayment plan is quarterly.
  • The moratorium is 36 months from the date of disbursement of the loan.
  • The security arrangement includes a minimum capital contribution of 20%, a mortgage debenture, a local mortgage and a lien on trade stock and equipment items.
  • The other conditions include at least three referrals from sponsors or recognized organizations or associations. Minimum of three years of relevant experience and no bad credit history with any bank.
  • The financing structure is the minimum equity contribution of 20% and 80% of the deposit money Bank loan.
  • The source of reimbursement is the proceeds from the sale of music or performance records.

Banks to visit for loans: The central bank said potential candidates should apply any bank with a business plan statement detailing how much is needed for their business proposition. All deposit banks are eligible to participate in the initiative.

[Download full document: Modalities For Implementing CIFI]


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