The disbursement of the CVFF was earlier approved by the President in 2019, but the process has lingered on for about two years now.
5 selected banks to receive Cabotage Vessel financing fund when amount hits $50m
The Minister of Transportation, Mu’azu Jaji Sambo, has confirmed that the Central Bank of Nigeria, CBN, will honour President Buhari's approval to disburse the $350 million and N16 billion Cabotage Vessel Financing Fund (CVFF) to five selected banks once the money hits $50 million.
The new development was revealed by the Director of Press and Public Relations in the ministry of transportation, Henshaw Ogubike after stakeholders of the ministry concluded a meeting with representatives and Heads of the five Primary Lending Institutions which include Polaris Bank, UBA, Union Bank, Zenith Bank, Jaiz Bank, and the stakeholders in the shipping industry - the Director General, Nigerian Maritime Administration and Safety Agency, NIMASA, the MD Shipping, Nigerian National Petroleum Company Limited, NNPCL among others.
The CVFF was created as an intervention fund by the federal government to develop the indigenous shipping capacity in the country for the maintenance of existing vessels or the purchase of new ones.
The CVFF was established under the Cabotage and Inland Shipping (Cabotage) Act 2003 to help operators in the industry get finance to maintain their vessels or purchase new ones.
The Act establishing the fund also empowers the Minister of Transportation to establish guidelines that will assist the disbursement of the fund to operators in the industry who are eligible.
While explaining how the payment will be made, the minister, Sambo noted that according to instructions given by the President, the CBN Treasury Single Account (TSA) will continue to receive the two percent charge that makes up the CVFF, and each time the account hits $50million, the Transportation Minister, on the recommendation of NIMASA, will inform the CBN to release the amount to any of the five approved commercial banks for disbursement.
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