By News Desk,
The African Development Bank (AfDB) has approved a $50 million line of credit to Nigeria’s Fidelity Bank Plc to support small and medium sized.
The money is also meant to support women-owned enterprises in selected transformative sectors, including close to a hundred SMEs in manufacturing, health and education.
Approved by the Bank’s Board on 10 October 2018, the facility is fully dedicated to financing micro, small and medium sized enterprises (MSMEs), with a minimum of 30 percent going to women-owned enterprises.
The loan will enhance Fidelity Bank’s liquidity and help meet the demand for medium-term funding to players in the target sectors, contributing to improved quality of lives, job and wealth creation and tax-revenue generation.
The facility complements the Government of Nigeria’s long-term development strategy, as espoused in its Vision 20:2020 agenda.
Aligned with Nigeria’s Economic Recovery and Growth Plan 2017-2020 (ERPG), the funding will ultimately boost enterprise competitiveness and expand Nigeria’s economic base.
The ERPG seeks to stimulate Nigeria’s economic growth, catalyse macroeconomic stability, foster diversification of the economy, and enhance social inclusion as well as governance.
According to AfDB, SMEs account for 30 per cent of Fidelity Bank’s loan portfolio.
The selection of the tier 2 Nigerian bank for this seven-year credit facility (with a grace period of two years) is based on its strong niche presence in the SME and mid-sized corporate space.
It is also in recognition of the bank’s credit management and strong track record with the African Development Bank. The Nigerian lender has previously received US$18 million and US$75 million lines of credit from the development finance institution in 2001 and 2013, respectively.
“Fidelity Bank is a niche player, focused on the SME space and this US$50 million credit line will contribute to strengthening its presence in its key market segments,” said Ebrima Faal, Senior Director, Nigeria Country Office at the African Development Bank.
“The Nigerian financial institution also continues to meet its ongoing credit obligations under the terms of previous support received from the African Development Bank.”
The line of credit to the Nigerian financial institution is consistent with the Bank’s Ten-Year Strategy (2013–2022). It also aligns with two of its High 5 priorities – Industrialize Africa and Improve the quality of life for the people of Africa.
Founded in 1987, Fidelity Bank Plc has grown from its marginal position into a stable banking institution.
Currently the 10th largest commercial bank in Nigeria by asset size, it was listed on the Nigerian Stock Exchange in May 2005.
It has a broad client base of about four million customers nationwide, served from a network of over 240 branches and business offices, supported by alternative service delivery channels like ATMs, mobile and electronic banking, and agency banking channels.
Following its renewed digital banking and retail drive, Fidelity Bank was ranked 4th best bank in Nigeria in the retail market segment in the KPMG Banking Industry Customer Satisfaction Survey (BICSS) in 2017.