CBN orders banks to discontinue MCF contributions

Yemisi Izuora
The central Bank of Nigeria, (CBN) has said that some banks have continued to contribute money into the N20 billion Micro Credit Fund ( MCF) despite the fact that the Bankers Committee had in 2010 stopped banks from contributing to the fund.

The MCF was created by the Bankers Committee in February 2008 to complement the poverty and small and micro credit interventions by government at all levels as well as the activities of the Microfinance banks in supplying a large but cheap source of finance to the small and micro entrepreneurs.

Although it was projected to grow to N100 billion by 2010, the contribution into the fund was stopped through the decision reached at the 298th Bankers’ Committee Meeting of March 15, 2010 due to lack of commitment by banks and the state governments involved.

The decision to stop the MCF was borne out of the fact that after two years of its existence, deposit money banks were not forthcoming in their contributions to the fund and in the same vein, only few states responded to the programme.

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