The framework and transaction dynamics for the Youth Ignite Programme are as follows:
- Screening / selection from the online entries.
- Two (2) days intensive classroom training.
- Submission of a Business Plan, written in a format and detail that is acceptable for BOI funding.
- Disbursement through selected Microfinance Banks (MFBs) across the country.
- AGDC and BOI screen the applications against set criteria.
- Successful applicants are referred to the partnering Microfinance Banks for funding based on the project location.
- The Microfinance Banks request disbursement of the aggregate loan amounts from BOI.
- The MFB issues Offer Letter and Customer accepts the offer and meets all conditions precedent to draw down, in line with the terms of the Offer specified by the respective MFBs.
The key features of the Youth Ignite Project include:
|RATIONALE||· The scheme will provide the young aspiring entrepreneurs operating micro business the opportunity to access funds for the actualization of their business ideas, as well as the expansion of their existing businesses.|
|TARGET MARKET/ CRITERIA||This product will be available to:
Young Nigerian aspiring entrepreneurs above the age of 18, who have participated in the Entrepreneurship Capacity Building Programme (as stipulated in the Training Programme Framework above).
|SCHEME PARTNERS||The Bank will collaborate with the following:
§ AGDC and other training partners to facilitate the Entrepreneurship Capacity Building programme.
§ Qualified Microfinance Banks that satisfy CBN’s Prudential Guidelines for MFBs.
|PROJECTED IMPACT||The programme shall support the establishment and/or expansion of 1,000,000 micro enterprises promoted by Nigerian youths over the 5 year period.
The scheme is expected to create a minimum of 1,200,000 direct jobs and 4,800,000 indirect jobs, totaling 6,000,000 jobs over the five years period.
|PROGRAM LIMIT||N10.0 Billion in the first phase|
|SINGLE OBLIGOR LIMIT||MFBs: 25% of paid up share capital or 10% of total deposits Ultimate Beneficiaries: Up to N100,000 for loans, scalable up to N500,000 for performing accounts upon liquidation of the initial loan.|
|APPROVAL LIMIT||In line with the Bank’s approval limit.|
|PRICING||Interest Rate to MFB: 5% per annum.
Interest Rate to Ultimate Beneficiaries: 8% per annum
Fees: 1% Processing fee.
|TENOR||21 months inclusive of 3 months moratorium on principal repayment.|
|MORATORIUM||Three (3) months from date of Loan Disbursement.|
|SECURITY||Security for the facility shall be:
Irrevocable Written Undertaking to recover the loans from the Beneficiaries.
|FUNDING STRUCTURE||Term Loan – up to 100% of loan amount required
Working capital – up to 100% of loan amount required
|LOAN PROCESSING TURN AROUND TIME||
In line with the standard operating procedures of the MFBs.
|Disbursement shall be through Microfinance Banks to the final beneficiaries not more than 2 working days after the MFB is credited.|
|REPAYMENT SOURCE||From proceeds of the operation of the business to BOI through the Microfinance Banks.|
|LOAN REPAYMENT MODE||To be determined by the respective MFBs.|