Why LSETF under-performed on MSMEs funding – REPORT
The Lagos State Employment Trust Fund (LSETF) under-performed in the funding of micro, small and medium enterprises (MSMEs) in the state between 2017 and 2018 due to paucity of funds, a report of Social Impact Assessment (SIA) of activities of the Fund has revealed.
Naira
The Social Impact Assessment Report on LSETF Projects conducted by Sages Consult Limited with the support of Ford Foundation showed that LSETF posted 41.8 percent effectiveness within the period, funding 7,817 MSMEs as against the expected 18,705 by 2018.
The main objective of the SIA was to evaluate the impact of LSETF activities on beneficiaries based on jobs created and business growth and based on the Fund’s mandate to provide financial support to residents of Lagos State, for job and wealth creation and to tackle unemployment.
The report noted that the Fund achieved less than half of planned disbursements at the same period with an effectiveness of 41.8 percent, disbursing to 7,817 MSMEs out of 18,705 applications. In adequacy of funds was the reason attributed for the less than optimum performance.
The SIA report stated: “The LSETF funded 7,817 MSMEs as against the expected 18,705 by 2018. This represents 41.79% effectiveness. The LSETF had a surfeit of applications but paucity of funds meant that the Fund had to rationalise the interventions among the two sectors (entrepreneurship and innovation) to be able to impact on all sectors. Going forward and using the results of the economic analysis of SIA, LSETF can make more informed judgements on the interventions that performed more efficiently adjust future interventions accordingly.
“Paucity of funds impacted effectiveness in two ways. First, the Lagos State government was unable to release funds to the project optimally and at the expected periods. Second, the demand for loans by Lagos residents far exceeded the total supply of seed funds available for each year which meant that LSETF had to rationalise disbursements to cover as many beneficiaries as possible.
“In the first year of disbursement, SME loans which are the more high-value loans were accorded some advantage but this meant that fewer number of beneficiaries were granted loans than would have been granted if the lower valued loans in the Micro Enterprise (ME) and Micro Enterprise Start-up (MES) categories had been given loans.”
Source:https://samueljackson12.blogspot.com/2019/03/why-lsetf-under-performed-on-msmes.html
Naira
The Social Impact Assessment Report on LSETF Projects conducted by Sages Consult Limited with the support of Ford Foundation showed that LSETF posted 41.8 percent effectiveness within the period, funding 7,817 MSMEs as against the expected 18,705 by 2018.
The main objective of the SIA was to evaluate the impact of LSETF activities on beneficiaries based on jobs created and business growth and based on the Fund’s mandate to provide financial support to residents of Lagos State, for job and wealth creation and to tackle unemployment.
The report noted that the Fund achieved less than half of planned disbursements at the same period with an effectiveness of 41.8 percent, disbursing to 7,817 MSMEs out of 18,705 applications. In adequacy of funds was the reason attributed for the less than optimum performance.
The SIA report stated: “The LSETF funded 7,817 MSMEs as against the expected 18,705 by 2018. This represents 41.79% effectiveness. The LSETF had a surfeit of applications but paucity of funds meant that the Fund had to rationalise the interventions among the two sectors (entrepreneurship and innovation) to be able to impact on all sectors. Going forward and using the results of the economic analysis of SIA, LSETF can make more informed judgements on the interventions that performed more efficiently adjust future interventions accordingly.
“Paucity of funds impacted effectiveness in two ways. First, the Lagos State government was unable to release funds to the project optimally and at the expected periods. Second, the demand for loans by Lagos residents far exceeded the total supply of seed funds available for each year which meant that LSETF had to rationalise disbursements to cover as many beneficiaries as possible.
“In the first year of disbursement, SME loans which are the more high-value loans were accorded some advantage but this meant that fewer number of beneficiaries were granted loans than would have been granted if the lower valued loans in the Micro Enterprise (ME) and Micro Enterprise Start-up (MES) categories had been given loans.”
Source:https://samueljackson12.blogspot.com/2019/03/why-lsetf-under-performed-on-msmes.html
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