The Bank of Industry (BoI) has signed a memorandum of understanding (MoU) with Ecobank Nigeria, the United Bank for Africa Plc, Diamond Bank, First City Monument Bank, Fidelity Bank Plc and five other banks in order to provide loans at low interest rate to operators of small and medium scale enterprises (SMEs) in the country.

The others are Access Bank Plc, First Bank Nigeria Limited, Skye Bank Plc, Stanbic IBTC Bank and Standard Chartered Bank Limited.

The Managing Director/Chief Executive, BoI, Mr. Rasheed Olaoluwa was quoted in a statement at the weekend to have said the 10 banks were selected based on their support to the SMEs, adding that the low interest loan would heighten activities of SMEs.

According to the MoU, the ten banks would provide working capital loans to SMEs qualified by the BoI at interest rate of Monetary Policy Rate (MPR) plus six per cent, with tenor ranging from six months to 12 months.

The BoI on the other hand would provide term loans to the qualified SMEs at interest rate between nine and ten per cent with tenor ranging from three to five years, and moratorium of six to 12 months.

The BoI boss explained that the activities in which BoI and the SME-friendly banks will collaborate among other things include the provision of the long-term loans to qualified SMEs by BoI based on its risk acceptance criteria; provision of working capital to the SMEs by the banks also based on their individual risk acceptance criteria.

Speaking at the event, Deputy Managing Director, Ecobank Nigeria, Tony Okpanachi, explained that the selection of Ecobank by BoI was in recognition of the massive support the bank has offered the sub-sector overtime. He observed that the support has won the Ecobank several awards and recognitions in recent times. He also assured customers that Ecobank would continue to partner other agencies to develop the sub-sector.