By Babajide Komolafe
The Central Bank of Nigeria (CBN) has given banks 60 days deadline to process loan application from small and medium enterprises under Small and Medium Enterprises Credit Guarantee scheme (SMECGS)This is one of the highlights of the guidelines for scheme issued by the apex bank on Friday.
On the procedure for applying for the guarantee, The guideline among others stated, â€œ All loan applications by SME promoters under the Scheme shall be made directly to the Participating Bank accompanied by the necessary documents as per normal loan processing requirement and the PBs applying the same degree of due diligence and professionalism as in the normal course of banking business.
Applications received by Participating Banks should be processed. promptly and the period elapsing between the submission of an application and requisite documents for appraisal under the Scheme and
its approval or otherwise will not exceed 60 days.
Banks may call for information which has not been sufficiently provided by the applicant.
Officials of the Managing Agent may call on banks which have not acted within a reasonable time on any application submitted to them.
Participating Banks should submit application for guarantee using a standard application form, on behalf of their clients to the Managing Agent .Â Â The application for a guarantee should be accompanied with Offer Letters.
Projects under the Scheme shall be subject to verification by the Managing Agent. Acceptance or rejection of an application for a guarantee by the CBN shall be communicated to the PB and the borrower within 14 working days after verification.Â The project shall be subject to monitoring by the Managing Agent (CBN) during the loan period.
The CBN has the right to reject a request from any Participating Bank if it contravenes any section of the Guidelines.â€
To be eligible for the scheme, â€œA borrower shall meet the following criteria to be eligible:Â Â Any entity falling within the definition of an SME;
A wholly-owned and managed Nigerian private limited company registered under the Companies and AlliedÂ Matters Act of 1990.