1. Transforming Nigeria’s Industrial Sector LIVESTOCK FINANCING and AGRI-BUSINESS A BOI presentation at the Retreat on Livestock and Dairy Development in Nigeria June 8, 2016

2. Transforming Nigeria’s Industrial Sector 2 Introduction PROTOCOLS. It is our honor and privilege to present this paper at this occasion which brings together all major stakeholders in the livestock and dairy subsector. The Bank of Industry (BOI) was established in October, 2001 following the reconstruction of the Nigerian Industrial Development Bank (NIDB) BOI’s mandate is to provide financing and business support services to entrepreneurs especially SMEs with strong potentials for employment generation and exports. BOI was conceived to catalyze the transformation of the real sector, which includes Livestock and Dairy production.

3. Transforming Nigeria’s Industrial Sector BOI’s strategy for Livestock and Dairy financing BOI’s strategy for livestock and Dairy value chain financing is premised on a tripod of ‘Input, Output and Outcome’ which is aimed at maximizing its developmental impact and creating massive employment, especially at the bottom of the pyramid. Input - This would be through the financing of suppliers of Inputs, Feeds, Breeders and Veterinary service providers. These would be ring-fenced around major Livestock and Dairy processors. Output - Job creation and access to market for the primary products through the processors. Outcome - Wealth creation, poverty alleviation, value addition to primary produce, and increase in contribution of Livestock and Dairy to GDP.

4. Transforming Nigeria’s Industrial Sector Livestock and Dairy value chain Inputs Production Processing Distribution Marketing Feeds Compounds Breeding Veterinary Services Calf to Cow Fattening Milk, Beef, Butter, Cheese Leather & Products Packaging Supermarkets Household Restaurants Export

5. Transforming Nigeria’s Industrial Sector Demand for financial services within the value chain Input Dealers Producers/ Association Processors/ Traders Associations Traders / Exporters Market/ Consumers Different financial requirements and services Available Financial Products Equity Investment Credit lines (Loans) Export finance Ware house receipt Insurance Etc.

6. Transforming Nigeria’s Industrial Sector BOI’s Value proposition for Livestock and Dairy 6 Provision of Long-Term Fund: The Bank provides long-term funding with tenor of up to 3-8 years including moratorium of 1-4 years depending on the source/line of credit. Provision of structured working Capital facility Most Commercial and other Financial Institutions provide relatively expensive and short tenored facilities which are not so appropriate for acquisition of long term assets.

7. Transforming Nigeria’s Industrial Sector BOI’s Value proposition for Livestock and Dairy 7 Concessionary Interest rates: BOI also charge subsidized interest rates ranging from 4-10% depending on the line of credit. The high cost of available fund from commercial and other Financial Institutions has hampered the cash flow and overall financial performance of most Industrial concerns thus limiting their contribution to the national economy.

8. Transforming Nigeria’s Industrial Sector BOI’s Value proposition for Livestock and Dairy 8 Provision of Advisory Services: Aside from providing credit facilities at subsidized terms, the Bank also provides business advisory services and capacity building to its customers in fulfilment of its developmental objectives.

9. Transforming Nigeria’s Industrial Sector BOI’s Value proposition for Livestock and Dairy 9 Partnership with various stakeholders: The Bank also leverage on its partnership with various local and international stakeholders such as UNIDO, AfDB, Afrexim, AFC, British Council, Friesland/Wamco, CBN, Federal Ministry of Agriculture, State Governments, Dangote Foundation, EDCs etc. to assist its customers in capacity building and access to markets.

10. Transforming Nigeria’s Industrial Sector BOI’s Value proposition for Livestock and Dairy (Cont.) 10 Collaboration with Nigeria Incentive-Based Risk- Sharing system for Agric-Lending (NIRSAL) - Purposely to mitigate the high risks in lending to the agric and agro allied sectors including livestock and Diary projects. - BOI will generate quality deals in the agric and agro allied sectors and provide suitable funding. - NIRSAL will provide guarantee for BOI loan, insure the assets financed and provide technical support for BOI and its customers.

11. Transforming Nigeria’s Industrial Sector BOI’s Impact on the subsector to date 11 Total Loans disbursed = N240.0 billion No of Beneficiaries = 1,250 No of jobs created = Over 1.0 million jobs

12. Transforming Nigeria’s Industrial Sector Other suggestions for the growth of the sector Need for a comprehensive public and private sector intervention programme covering: – Technical assistance (PPP) – Finance – Policy and institutions – Infrastructure (PPP) –Processing facilities –Power (PPP) –Logistics (warehouse, silos, etc.) –Establishment of clusters BOI is ready to collaborate with relevant agencies facilitate the provision of the above facilities

13. Transforming Nigeria’s Industrial Sector Some POSERS for Stakeholders How can we transform Nigeria’s Livestock and Dairy subsector from predominantly primary production to manufactured products? What areas can we introduce modern technologies and innovations to replace our traditional methods? How can we convert Nigeria’s comparative advantages in this sector to competitive advantages?

14. Transforming Nigeria’s Industrial Sector 14 BOI’s Offices and States Covered Lagos Ondo Osun Oyo FCT Kaduna Bauchi Gombe Cross River Enugu Anambra Delta Rivers Kano Niger Headquarters Corporate Office State Office Enhancing our footprint across the entire country is a key strategic intent of the bank. This would not only enable enhanced access by our clients to our products and services, but also provide an effective structure for monitoring the progress of projects that the bank is involved in. Our offices increased from 7 in 2014 to 17 states offices. These offices are situated in key business locations across the country. Sokoto Katsina

15. Transforming Nigeria’s Industrial Sector DIGITAL PRODUCT OFFERINGS WERE LAUNCHED FOR SMEs IN 2015 15 BOI LOAN APPLICATION AND TRACKING PORTAL The Loan Application and Tracking System is an IT tool developed to further enhance customer service delivery to our SME loan applicants. The tool enable customers to electronically apply for loans and also obtain online, real time updates on the progress of such loans through the bank’s system BOI is currently present in 17 locations covering various states, to ensure this does not affect our reach and in line with the growing trend to leverage technology in delivering quality service to customers, we launched some digital offerings to its customers and the general public 1 1 BOI SME ACCOUNTING APPLICATION (SAAPP) The SME Accounting Application (SAAPP) Software was developed to provide SMEs with a user friendly and simplified accounting tool that does not require formal accounting knowledge by the entrepreneur. It can be downloaded from the bank’s website with a token fee. Standard financial statements such as: Statement of financial position, Income Statement, and Cash Flow statements are available from the software 2 2

16. Transforming Nigeria’s Industrial Sector DIGITAL PRODUCT OFFERINGS WERE LAUNCHED FOR SMEs IN 2015 16 SME MOBILE APP The SME Mobile App provide members of the public, especially entrepreneurs with easy access to information about key activities, products and services of the Bank. The App can be downloaded onto mobile devices operating on various platforms. Some of the features available on the App are: About BOI, Who the Bank can assist (A to Z Eligibility Criteria for accessing BOI’s loans), Online Loan Application and Tracking Portal, Features of Products and Services and the SME Customer Portal In line with the growing trend to leverage technology in delivering quality service to customers, Bank of Industry recently launched some digital offerings to its customers and the general public 3 3 BOI SME CUSTOMER PORTAL. The SME Customer portal provides a platform to assist our SME customers to showcase their products and contact details. This initiative provide free branding and publicity support for SMEs, especially those that do not have functional websites. BANK OF INDUSTRY SME CUSTOMER PORTAL 4 4

17. Transforming Nigeria’s Industrial Sector BOI pledges its full support to all the stakeholders as we deliberate on these and other issues facing the Nigerian livestock and dairy subsector. For further information on how to access BOI funding, please visit www.boi.ng www.boi.ng THANK YOU