NCDMB approves Nigerian Content Intervention Fund expansion to $350m

NCDMB approves Nigerian Content Intervention Fund expansion to US$350 million

The Nigerian Content Development and Monitoring Board, (NCDMB), Governing Council, has approved the expansion of the Nigerian Content Intervention Fund from $200 million to $350 million.

The enlargement of the Fund by 75 per cent or $150 million was part of the decisions taken at the recent NCDMB Governing Council meeting, which held virtually on June 16, 2020.

According to a statement made available to iBrandTV, the meeting chaired by the Minister of State for Petroleum Resources, Chief Timipre Sylva, who is the Chairman of the Council, approved that US$100 million from the additional funds would be deployed to boost the five existing loan products of the NCI Fund.

The products according to the statement, include manufacturing, asset acquisition, contract financing, loan refinancing and community contractor financing.

Also, the Council also approved that US$20 million and US$30 million respectively should be deployed to two newly developed loan product types – the Intervention Fund for Women in Oil & Gas and PETAN Products, which include Working Capital loans and Capacity Building loans for PETAN member companies.

READ ALSO: NCDMB signs agreement with Duport, Eraskon on oil blending plant, others

The NCI Fund was instituted in 2017 as a US$200 million Fund managed by the Bank
of Industry (BoI), engaged to facilitate on-lending to qualified stakeholders in the
Nigerian Oil and Gas industry on five loan product types.

The NCI Fund is a portion of the Nigerian Content Development Fund (NCDF), aggregated from the one per cent deduction from the value of contracts executed in the upstream sector of the oil and gas industry.

About 94 per cent of the NCI Funds has been disbursed to 27 beneficiaries as at May 2020. NCDMB has received new applications from 100 companies for nearly triple the size of the original fund.

Guidelines for the NCI Fund provide that beneficiaries of the Manufacturing Loan
and Asset acquisition Loan can access a maximum of US$10million respectively.

Also, beneficiaries of Contract finance Loan can access US$5million while
beneficiaries of the Loan Re-financing package can access US$10million, with
beneficiaries of the Community Contractor Finance Scheme limited to N20million.

The maximum tenure for all loan types is 5 years and applicants cannot have two
different loans running simultaneously.

At the onset of the Fund, the applicable interest rate for the various loan types was
pegged at eight (8) per cent, except the Community Contractor Finance Scheme,
which was five (5) per cent.

However in April 2020 as part of NCDMB’s response to mitigate economic impact of
the coronavirus pandemic, the Governing Council approved reduction of the interest
rate from eight (8) to six (6) per cent per annum for all four of the loan products. The
Board also extended the moratorium for all loan products.

LEAVE A REPLY

Please enter your comment!
Please enter your name here

This site uses Akismet to reduce spam. Learn how your comment data is processed.