What is the Community Contractors Finance (CCF) Scheme?
The CCF is an intervention fund established by the Nigerian Content Development and Monitoring Board (NCDMB), in partnership with the Bank of Industry (Boi) to provide access to affordable credit for indigenous contractors from oil-producing communities. It enables them to execute contracts, acquire assets, and fund working capital needs within the oil and gas sector.
What is the size of the fund?
₦50 Billion (Fifty Billion Naira)
What is the maximum loan amount (Single Obligor Limit)?
₦100 Million per contractor (subject to review).
Who is eligible to apply?
To qualify, applicants must:
– Be an indigenous contractor from an oil-producing community.
– Be registered with the Corporate Affairs Commission (CAC).
– Operate in the upstream or midstream oil and gas sector.
– Hold a valid contract (minimum of 3 months remaining) with an International Oil Company (IOC) or a National Oil Company (NOC).
– Possess required regulatory permits from DPR, NOGICJQS, NIPEX, etc.
What loan types are available?
– Working Capital (Time loan)
– Invoice Discounting
– Term Loan / Asset Finance
What is the Interest rate?
8% per annum (all-in), subject to review by NCDMB and BoI.
Is there a Moratorium period?
Yes. A 30-90-day moratorium on principal repayment may be granted, based on the contractor’s cash flow.
What is the loan tenure?
Up to one (1) year. Extensions may be allowed if aligned with the contract’s payment terms.
What can the funds be used for?
To finance:
– Execution of awarded contracts
– Asset acquisition
– Working capital requirements
– Invoice discounting
What is the security/collateral requirement?
– Personal guarantee by the business promoter(s), with a notarised statement of net worth.
– Irrevocable Standing Payment Order (ISPO) from the contract issuer.
– Mandated Lockbox account with the receiving bank for loan repayments.
How long does processing take?
Approximately 15 working days from the submission of complete documentation and meeting all requirements.
How do I apply?
Submit your application through the designated online portal of the Participating Financial Institution (PFI). You will need:
– CAC incorporation documents
– Award letter from IOC/NOC
– Valid permits (DPR, NOGICJQS, NIPEX)
– Pro-forma invoices (if applicable)
– Latest audited financial statements
– Completed application form and eligibility checklist
Where can I apply?
Apply online through the portal of the Participating Financial Institution (PFI) managing the scheme, currently FCMB and the Bank of Industry (BoI).
How long does it take to process a loan application?
Processing time is approximately 15 working days, assuming all documentation is complete and correct.
How do I repay the loan?
Repayments are scheduled monthly or quarterly, as agreed with BoI. Payments are made through a dedicated Lockbox account.
What is a Lockbox account?
This is a dedicated bank account where payments from your contract issuer are received. The bank automatically deducts loan repayments before releasing any remaining balance to you.
What happens if I default on the loan?
Defaults are handled under standard BoI recovery procedures, which may include:
– Legal recovery actions
– Credit blacklisting
– Inability to access future government-backed loans
# What kind of collateral or security is required?
– Personal guarantee of the business promoter(s)
– Notarised statement of net worth
– Irrevocable Standing Payment Order (ISPO) from the contract issuer
– Lockbox account arrangement for repayments
# Can I apply if my contract is not yet active or signed?
No. You must have a valid, awarded contract with at least three
(3) months remaining before you can apply.
# Can I use the loan for non-oil and gas related activities?
No. The loan is strictly for financing oil and gas-related contracts and operations.
# Is the interest rate subsidised?
Yes. The 8% rate is lower than typical commercial bank rates, because this is NCDMB’s intervention to support local capacity building.
# Who do I contact if I need support or guidance?
For inquiries, contact the Bank of Industry (BoI) via its website, or visit a BoI branch. You may also reach out through the NCDMB website for updates and resources.
# Why use Participating Financial Institution (PFIs)?
PFIs have the geographical spread and reach through the grassroot where the community contractors are domiciled. With their spread, reach and agility, qualified community contractors are able to access the funding scheme.
# Performance Monitoring
The PFI will provide monthly reports to BoI on the performance of loans granted to beneficiaries. In turn, BoI will report to NCDMB on a quarterly basis. Joint visits will be paid to beneficiaries to ascertain true positions of their loan utilisation.
SOURCE: businesshilights.com.ng
