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BOI MD under fire over lack of knowledge on loans beneficiaries

by Business News Report

Managing Director of Bank of Industry ( BOI), Olukayode Pitan came under Senators fire for not  knowing the identities of  beneficiaries of loans given out by the Bank across the country. The BOI boss ran into trouble while making submissions before  the Senate Committee on Industry for  2022  budget defence. In his remarks on loans given out by the Bank, Pitan who  claimed that they don’t know the loan beneficiaries, but the destination of the loans, said that  the loans are secured through bank guarantees provided by commercial banks on behalf of the beneficiaries. He said, “Loans are given to commercial banks that provide guarantees, which then forwarded the money to the beneficiaries 

“Angered by his  submission the trio of Senators  Adamu Bulkachuwa, Christopher Ekpenyong and Danjuma La’ah, said that they are in dark about the activities of Bank of Industry in their Senatorial Districts. On his part, Senator  Danjuma said : ” I don’t know what is going on with Bank of Industry activities in my Senatorial district.” Also, Senator Ekpenyong in reaction lamented that most of  his Senatorial district members are unable to access loans from Bank of Industry adding Union Bank and United Bank of Africa (UBA) do not give Bank Guarantee to his people. In addition, Senator Bulkachuwa said, “The MD/CEO, you made comments while trying to answer my questions on the distribution’s of loan  beneficiaries. You actually said that you were not in the position to know, exactly where these loans are going to, with regards to the geopolitical areas of the country.

“Does it mean that the Bank of Industry does not  know where the loans are going to and where the actual beneficiaries are located in the country? 

If you don’t know , we are interested in knowing where those loans go to. You, the giver of the loan should be more interested in the loan and where each kobo you give out is going and which part of the country is benefiting. You should be able to know. You should not leave it for the commercial banks to handle alone. Our interest is to know how the bank of industry is performing its duty in terms of ensuring that industries are spread across the country”.

Pitan who   responded, said,  “The Senator misunderstood me. BOI knows where our money is. We know where every kobo goes to but not the beneficiaries because we are not the one determining the beneficiaries.  “The commercial banks are the ones that give guarantees because they are the ones that would finalise the process. They determine where the loans go but there is no loan that goes out of the bank of industry that we on our own, don’t analyse. It is a requirement every month for the bank of industry to provide the document. We know exactly where our monies are.” The Committee Chaired by Senator Tokunbo Abiru, also  expressed dissatisfaction to meagre allocation for the Micro, Small and Medium Enterprises which are the real driver of economy in 2021 budget.

The Bank of Industry in 2021 budget released N165 billion to large enterprises in the country while Micro, Small and Medium Enterprises benefited N40 billion as at September, 2021. But the Managing Director of BOI while defending the meagre allocation  Micro, Small and Medium Enterprises said most people in that level are not ready to repay the loan believing that the money is government money and they don’t have to pay it back.

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