Following a November 16 resolution of the Upper Legislative Chamber, Senate’s Adhoc Committee commences holistic investigation into DBN’s disbursement of a N500 billion loan. to MSMEs across the country, allays fear of witchhunt
The Senate has begun investigating an alleged uneven disbursement of half a trillion naira loan to Micro, Small and Medium Enterprises (MSMES) in the six geo-political zones by the Development Bank of Nigeria (DBN).
Specifically, the Adhoc Committee set up by the Red Chamber has summoned seven Ministries, Departments and Agencies (MDAs) for interface over the alleged lopsided disbursement.
The affected MDAs are the Ministry of Finance, Budget and National Planning; Ministry of Trade and Investment; Central Bank of Nigeria (CBN); Development Bank of Nigeria (DBN); Small and Medium Enterprises Development Agency (SMEDAN); Bank of Industry (BoI) and the Bank of Agriculture (BoA).
The Senate had, on November 16, constituted an Adhoc Committee following a resolution at the plenary on a motion titled: ‘Uneven Disbursement of half a trillion naira loan to six geo-political regions by the DBN.’ The mandate of the committee, chaired by Senator Mohammed Sani Musa (APC Niger East), is to carry out a holistic investigation into the disbursement of the loan by DBN since the bank’s inception.
Speaking at the maiden committee meeting on Tuesday, Senator Musa said the purpose of the meeting was to map out strategies and modalities that would assist the committee in executing the onerous assignment. He said that although the investigation seems daunting, the committee would succeed with patriotism, cooperation and commitment.
Senator Musa explained that the establishment of DBN was to drive the effectiveness of MSMEs and the environment they operate, adding that its establishment was a good idea by the federal government and its development partners. The Chairman added that the key objective of the DBN was to tackle constraints faced by MSMEs through the provision of finance and partial credit guarantees to eligible financial intermediaries on a market-conforming financial sustainable basis.
He, however, said that there are worries about the disbursement methodology employed by the bank and a lack of awareness of its operation, saying that not every MSME in the region, especially in the North, knows about the bank. According to him, the committee will effectively and thoroughly investigate the activities and operations of the DBN to ascertain if it conforms with its Establishment Act and follow due diligence in the execution of its mandate.
Senator Musa said the committee was not out to witch-hunt anyone but would evaluate the criteria that qualify MSMEs to access the loan and at what interest rate. He added that the committee would review the total amount disbursed to beneficiary MSMEs from inception to date and the total recovery (if any). The Chairman also said the committee would examine the source of funding for DBN, including contributions from development partners.
Presenting the motion on November 16, Senator Mohammed Ali Ndume (APC, Borno South) said the investigation was part of what was happening in the financial sector that the government deliberately created to address poverty.
According to him, what happened in DBN was unfortunate, clarifying that his submissions on the motion on uneven distribution of the MSMEs loan were not an allegation but a fact that the DBN has not disputed.
Senator Ndume said the committee was not out to witch-hunt anyone but to find a solution and help DBN to achieve its mandate.
While urging the committee members to visit the DBN website to study its operation since inception, he said facts indicated that there were some individuals who were interested in the loan, especially in the North, but could not access the loan.
Ojochenemi Onje-James is a research writer and journalist with years of proven footprints in areas of crime and politics. She has a M.Sc in International Relations and Strategic Studies as well as a B.Sc in Mass Communication.