Former Executive Director of Standard Chartered Bank, Mr Alex Mould is urging the government to discontinue the decision to use the National Board for Small Scale Industries (NBSSI) to disbursed the GHS600million soft Loan stimulus package for Small Medium Enterprises (SMEs).
The soft loans which are under the Coronavirus Alleviation Programme (CAP) are intended to mitigate the effects of COVID-19 on the operations SMEs.
The government this week, announced NBSSI will have access to the fund this month and begin with the disbursement to SMEs in the country.
But the Energy and Finance Expert, Mr Mould believes NBSSI is not qualified to disburse the loans.
According to him, unlike financial institutions that are regulated, have credit underwriting standards and credit approval procedures, "the NBSSI is a bureaucratic institution controlled by politicians.
"Financial institutions should be the channel for disbursing the GHS600m earmarked for the SMEs under the CAP, or it could become a political slush fund otherwise," the immediate past Chief Executive of Ghana National Petroleum Corporation stressed.
Read the full statement below
NBSSI NOT QUALIFIED TO DISBURSE SMEs FUND UNDER CAP
The government should be crystal clear on the terms of GHS600m loan fund allocated to SMEs under the Coronavirus Alleviation Programme.
The National Board for Small Scale Industries (NBSSI) will, from this month, have access to government’s GHS 600 million soft loan stimulus package for SMEs.
The loan, which comes with a one-year moratorium and a two-year repayment period is intended to mitigate the effects of COVID-19 on the operations of micro, small and medium-sized businesses.
I want to highlight some of the potential challenges with this model.
Firstly, I can emphatically state the NBSSI is not qualified to disburse loans. Unlike Financial institutions that are regulated, have credit underwriting standards and credit approval procedures, the NBSSI is a bureaucratic institution controlled by politicians.
What safeguards has the NBSSI put in place to ensure that the funds disbursed are used for the approved purpose?
Other questions that require immediate clarity are:
1. What exactly is the qualifying criteria the NBSSI will outline for funds eligibility; in addition to the basic guidelines outlined by the Ministry of Finance?
2. What precisely can these funds be used for?: for example, are these eligible:
- workers salaries and statutory expenses
- interest repayments on loans to banks
- rent payments
- utility payments
- other working capital needs
Financial institutions should be the channel for disbursing the GHS600m earmarked for the SMEs under CAP, or it could become a political slush fund otherwise.
Clear risk-sharing allocation protocols must be agreed between Government and Financial institutions.
Additionally, stakeholder engagement e.g. trade associations, Association of small scale industries (ASSI) etc is necessary to help determine the needs of SMEs amid the COVID-19 pandemic.
We should all remember this is NOT free money and approval criteria need to be obvious and transparent.
Signed
Alex Mould
15/05/2020
Source: Isaac Kwame Owusu/Peacefmonline.com/[email protected]
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If you have a party that could estimate Tema Motorway interchange at 600 Million Dollars and thrown away by the world bank, an old man use just 56Million Dolars to do the same thing. Why would they not become suspicious of every money. Because they have their dealings in mind,
Does the man want to be running mate. I suspect so. May the soul of his daughter Rest In Peace!
The NDC knows what they did with similar funds in their time (looted) so they are suspicious of anything that has money attached. They are only good at stealing whatever cash they earmarked for the people so it keeps haunting them. These guys should NEVER taste power again in this country.
Too much negative thinking in this country. If people were looking only at the negative side of things, we would have all still been hunter/gatherers, using stones and sticks, no innovation. This is because we will always look at the negative side and stop whatever we want to do. Any initiative brought up, we are quick to look at the things that will not make it work, forgetting that there are other factors that can make it work. No wonder Africans are always waiting for the Europeans and Americans to try things and perfect them before we go to adopt them. We are not prepared to try and fail and then work to get things perfect. Pathetic.
Sh.utttt upp.ppp.... What did you NDC th.ieves do with MASLOC cash? You shared it to your followers. No wonder you are scarred.
F001z brigade. No imagination. pls help ur flagbearer to do de needful. Airbus on my mind. Also help him to be original. Further help him overcome the superstition of chooseing a running mate. U cud choose urself but dont spew ur ignornace. Jeeeeez!!