THE of Industry Limited (BOI) is Nigeria’s oldest,

THE NIGERIA BANK OF INDUSTRY (BOI)The Bank of Industry Limited (BOI) is Nigeria’s oldest, largest and most successful development financing institution (DFI). The bank took off in 1964 as Nigerian Industrial Development Bank (NIDB) Limited with an authorized share capital of 2 million (GBP) ( It was formed by the reconstruction of the NIDB in 2001 and merged with the Nigerian Bank for Commerce and Industry (NBCI, established 1973) in 2002(1).This was in furtherance of Nigeria’s resolve to avail finances to indigenous entrepreneurs, principally financing industrial equipment used in manufacturing.

MSMEs have enjoyed increased lending support from the BOI functioning within its portfolio as well as with Government, Donor & private sector Intervention Funds targeted at specified sectors (1). The target sub-sectors of the BOI include agro-processing, solid minerals, information technology, oil and gas and creative industry ( from BOI to SMEs start at N5m, though there are also provisions for lesser loans on its Matching Fund platform operated in collaboration with different state governments and on its Bottom of the Pyramid (BOP) scheme. Financing is only for companies or enterprises, not an individual person or group of persons.

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To secure a loan, the BOI requires the beneficiary to pledge some assets as part of its fiduciary responsibility. Other types of security the Bank accepts include a legal mortgage on a landed property (duly registered), debenture on company’s assets, a bank guarantee or external guarantors with notarized statement of net worth for loans below N10 million. The Bank is willing to share assets previously pledged to other lenders provided the Bank’s loan is adequately covered in the arrangement. It also accepts third party collateral.Under its general risk acceptance criteria, the BOI requires a prospective borrower to have a minimum of three years acceptable performance track record, but it also lends to start-ups discretionarily and on an individual basis. A startup would need to provide proof of cognate experience in its business area and would need to have a highly qualified management and operational team with sound management structure. (www. BOI has enhanced MSMEs’ access to finance by partnering with CBN to promote specialised funds for financial institutions who lend to MSMEs and cooperatives, with a focus on women and youth (1). An example of such would be the Micro, Small and Medium Enterprises Development Fund (MSMEDF) which was established in August 2015. The objectives, besides providing low interest funds to the SME subsector, was also to beget inclusive growth among others. The roles of the BOI under the MSMEDF guidelinesinclude bearing the risks involved with the loans granted, ensure the funds are being administered and used appropriately and yield monthly returns to the CBN (CBN Development Finance Department, 2014).Bottom of the PyramidThe BOI also commenced a Bottom of the Pyramid (BOP) scheme in line with its desire to achieve financial inclusion of entrepreneurs within an estimated population of 108million rural poor Nigerians as at 2006.

The scheme is financed jointly by the Dangote Foundation-BOI MSME Fund and the States Matching Fund, where the contribution of the both parties is in equal proportion.The BOI grants loans as the need arises to MicroFinance Banks (MFBs), which function as on-lending vehicles to the micro-enterprise/entrepreneurs at the lower stratum of the economy. These facilities, not exceeding N500,000 per obligor and N10million per cooperative, have tenors up to 36months with a moratorium, with a maximum charge of 7.5% (+2% maximum for additional fees for MFBs). Repayment for the loans by MSMEs to the Microfinance Banks is done in monthly installments. (Managed Funds department, BOI).

Aside the BOP scheme, the BOI recently secured a $750m facility from 17 financial institutions to fund the MSMEs sector. Among the lenders to provide the syndicated funds are the African Export-Import Bank, the ECOWAS Bank for Investment and Development and British Arab Commercial Bank Plc. ( BOI also announced recently a N1billion credit facility for fashion entrepreneurs. The maximum amount that can be given to a person is N30m and the fund provision is shared in a ratio 3:1 between the bank and individual.

Other conditions include a maximum of 5years tenure and 12months moratorium, with a lien on stock of trade as security. (


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