The Central Bank Of Nigeria (CBN) has given finance houses as well as leasing companies in the country up until September 30, 2014, to shore up their capital bases to N100 million.
The CBN had recently raised the capital base of Bureau de Change (BDC) operators in the country from N10 million to N35 million, giving an ultimatum which was extended on Monday to July 31 from July 15, 2014.
Finance and leasing companies as well as BDCs fall under the same department – Other Finance Institutions Supervisory Department (OFISD) – of the CBN.
Speaking at the official presentation of the Revised Guidelines for Finance Companies in Nigeria, the director, OFISD of the CBN, Ahmed Abdullahi, said the shoring up of the capital base from N20 million to N100 million was to have strong and viable finance companies in the country.
“We want finance companies and other institutions in the OFIS sub sector to become strong, virile and able to perform the functions that they were set up for. Of course the objective of the finance companies and their shareholders is profit after tax but for us we are interested to have OFIs that are able to service the MSMEs sub sector and provide access to finance those businesses so that we can have economic growth and development in the country.
“The agenda of the governor is to have a people centred central bank; he wants to emphasise job creation, he wants to emphasise businesses having access to finance and so all these institutions that are operating in the financial sector in which we have purview are supposed to be strong virile and able to perform that function.
“We are concerned about finance companies performing functions for which they are set up and that is why they need to have increased capital, good corporate governance policies and risk management policies need to be put in place so that they will be able to function properly,” he said.
