The Lagos State government has declared that the funds provided to company owners by the Lagos State Employment Trust Fund (LSETF) are still loans that need to be repaid within the allotted period.
The explanation was given by Mr. Akinyemi Ajigbotafe, the Commissioner for Wealth Creation and Employment, during the presentation of the Ministry’s scorecard at the Y2024 Ministerial Press Briefing, which was held in Alausa, Ikeja, to mark the start of Governor Babajide Olusola Sanwo-Olu’s second term.
He claimed that the need for the explanation stems from the fact that, despite all efforts to locate them, roughly 18% of the loan recipients have not yet made their payback to the government.
“I want to use this medium to clarify that the financial aid given by the Lagos State Employment Trust Fund is not a grant, as some people may have misinterpreted it, nor is it ‘Money for the boys,'” he stated.
He states that failure to return a loan on time or at all could result in potential beneficiaries being refused access to it. Defaulters also run the possibility of facing severe legal action from the government, as specified in the application form.
Acting Executive Secretary of LSETF, Feyisayo Alayande, discussed the agency’s procedures for enforcing repayment terms. He said that a defaulter would be blacklisted from future access to any loans, whether from public or private institutions.
She continued by saying that the organisation also has a section devoted to informing potential applicants about the terms and conditions of the loan and emphasising that it is neither free money nor an entitlement that won’t be tracked down.
As I speak, the organisation has a Fund Recovery Desk, and we collaborate with law enforcement to make sure that loans made to refractory people or corporate entities are recouped.
We also use the Guarantor’s information to track down any beneficiary who attempts to evade loan repayment. Ayandele warned that the guarantor would be responsible for the repayment or would have to reveal the location of the delinquent party.
The Acting Executive Secretary discussed the prerequisites that potential borrowers must meet in order to be eligible for an LSETF loan. These prerequisites include a government-issued ID card, a BVN, a NIN, and a LASRRA number.
Depending on the amount of the loan being asked for, she continued, the applicant may in some other circumstances be required to provide a certificate from the Corporate Affairs Commission (CAC) in addition to making a down payment of a refundable 5% equitable contribution.