Nigeria’s health sector is set to get a boost as Access Bank Plc begins to release loans through the Central Bank of Nigeria (CBN) credit support scheme to ramp up the capacity of the country’s pharmaceutical and healthcare industries.
The CBN Credit support for the Healthcare sector is an on-lending intervention scheme for the Healthcare sector developed as part of the pro-active measures to cushion the economic impact of the coronavirus (COVID-19) pandemic. The initiative was developed to provide funding to indigenous pharmaceutical companies and other organizations in the healthcare value chain to enable them increase capacity to meet the increasing demand for healthcare arising from the coronavirus pandemic.
This has become necessary as the country continues to tackle the evolving crisis of the Coronavirus pandemic. The Bank is reaffirming a long-held and proven stance on fostering sustainable development across the country.
The loan scheme is part of a six-point palliative by the Central Bank of Nigeria of which Access Bank is a participating financial institution (PFI). It was developed to provide funding to indigenous pharmaceutical companies and other organizations in the healthcare value chain, enabling them to increase capacity to meet the increasing demand for healthcare arising from the pandemic.
Earlier in the month, Access Bank’s Group Managing Director, Herbert Wigwe, had reassured the public of the bank’s commitment to do everything in its power to address the needs of the Nation in these uncertain times.
“It has become clear to all and sundry that Nigeria’s healthcare sector is in dire need of revitalization and Access Bank, under the auspices of the Central Bank of Nigeria, will be investing heavily in this sector in the coming months. We would be looking to grow Nigeria’s capacity to not only manufacture drugs and other medical supplies locally but also encourage entrepreneurs to take advantage of the opportunities that lie within the sector,” Wigwe said.
Nigeria’s healthcare product manufacturers, including pharmaceutical drugs and medical equipment; healthcare service providers/medical facilities – hospitals/clinics, diagnostic centres, laboratories, fitness and wellness centres, rehabilitation centres, dialysis centres, blood banks, et cetera, are eligible to access loans to enhance local drug manufacturing, increased bed count in hospitals across the country, funding of intensive care units as well as training, laboratory testing, equipment, and Research and Development.
The loan’s interest rate is set at a maximum of 5.0 per cent per annum (all-inclusive) up to 28th February 2021, making it more accessible to a larger percentage of the sector. Thereafter from 1st March 2021, interest on the facility shall revert to 9 per cent per annum (all-inclusive).
For working capital: 20% of their average turnover for the last 3 years up to a maximum of N500 million per obligor. Where the business is not up to 3 years in operation, 20% of the previous year’s turnover would be considered. For Term Loan: Maximum loan amount of N2 billion
Interest rate is a maximum of 5.0% p.a. (all inclusive) up to 28th February 2021. Thereafter, interest on the facility shall revert to 9% p.a. (all inclusive) as from 1st March 2021.
Working capital shall be for a maximum period of one (1) year, with provision for rollover not more than three (3) years. Term loan shall have a maximum tenor of not more than 10 years with a maximum of one year moratorium on repayment. For construction projects, the tenor shall be determined by the completion date.
Healthcare product manufacturer
Healthcare service providers/ medical facilities
Pharmaceutical/medical products distribution and logics services
Other human healthcare service providers
This initiative provides long-term, low cost finance to facilitate the development of the Nigerian healthcare sector. It will improve access to affordable credit for indigenous pharmaceutical companies for expansion and to encourage compliance with the WHO Good Manufacturing Practice. The scheme will contribute to the overall development of the Nigerian Healthcare system.