The Federal Executive Council (FEC) has approved credit facilities of $1.3 billion to support the Development Bank of Nigeria (DBN).

The Minister of Finance, Kemi Adeosun made this known at the end of the FEC meeting chaired by President Muhammadu Buhari at the Presidential Villa, Abuja.

She said the DBN has got $1.28 billion loans from some development partners, but the approval of the National Assembly is required to access the loans.

The loans will be used to finance the many Micro-Small and Medium Enterpreneurs (MSME) in the country.

She said: “The other memo was an approval for credit facilities totaling $1.3 billion to support the DBN. As you know the DBN recently received its licence and is been funded by some long term loans from some of our development partners.

“So the World Bank had given us $500 million repayable over 21 years and all of this is at concessional rate. The African Development Bank (AfDB) are giving us $450 million and KFW are giving us $200 million and the French Development Agency are giving us $130 million.

“To access this money, we are ready to disburse but there were two requirements that we need to make and one of them is the legal opinion by the Attorney General of the Federation and the other is the National Assembly’s approval.

“Before it goes to the National Assembly, it needs to be approved by FEC and the FEC simply approved today so that these loan requests should go to the National Assembly for approval. So we can access this money and the DBN can take off fully as it is expected to transform financing to our MSME sector.

“The Council enthusiastically approved these facilities which are long tenor meaning that the DBN will be able to lend to our MSMEs over much longer periods and at much lower rates. So the impact on the SMEs will be quite considerable.”

On the fear that the loans will add to the rising debt profile of the country, she said focus should be placed on the uses the loans will be put and not on debt profile.