World Bank Disburses $300m Palliative Loans

The World Bank has commenced payment of the $800m approved for the National Social Safety Net Program-Scale Up.

VOP Business gathered that the bank has disbursed about $299.99 million to Nigeria under the National Social Safety Net Programme-Scale Up approved by the World Bank on December 16, 2021.

Documents obtained from the World Bank confirmed the payment adding that the disbursement was made recently.

This means that with about 37.5 per cent of the entire loan disbursed, there is a pending balance of about $442.88m.

The $800m social safety net programme is a condition cash transfer scheduled to be implemented by the Federal Ministry of Humanitarian Affairs & Poverty Alleviation.

With this loan, the Federal Government plans to run a monthly cash transfer programme for poor and vulnerable Nigerians, who have been hit hard by recent policies, such as the fuel subsidy removal.

In October 2023, President Bola Tinubu formally launched the promised conditional cash transfer programme targeted at 15 million households nationwide billed to receive N75, 000 within three months.

The National Economic Council had earlier decided not to use the social register from the previous administration of Muhammadu Buhari for running the conditional cash transfer program due to credibility issues.

The financing agreement document for the National Social Safety Net Program-Scale Up between the Federal Republic of Nigeria and the International Development Association of the World Bank showed that the repayment will be made in installments, with the first payment due on January 15, 2027, and the last payment due on July 15, 2051.

The $800m loan obtained by the Federal Government attracts a maximum commitment charge rate of one-half of one per cent per annum on the Unwithdrawn Financing Balance and a service charge of three-fourths of one per cent per annum on the withdrawn credit balance, according to the document.

It also disclosed that the interest charge is one and a quarter per cent per annum on the withdrawn credit balance.