A loan scheme announced by the Cross River State Government has sparked public outrage after applicants were required to pay a N13,000 registration fee to access loans of up to N5 million.
The outrage followed a letter signed by Kalita Aruku, chairperson of the Cross River State Youth Empowerment Scheme, which was shared on Facebook by some residents of the state.
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In the letter, Mr Aruku stated that the Cross River State Government, in partnership with the Federal Government’s Renewed Hope Agenda through the Bank of Industry and Zenith Bank, was offering loans of up to N5 million to residents with existing businesses seeking to scale up.
“The loan will have an annual interest rate of 9% and can be repaid over three years,” the letter stated.
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The letter invited interested applicants to visit the scheme’s offices from 7 January. Although undated, its contents suggest it was issued on 6 January, as applicants were asked to appear “tomorrow, Wednesday, 7 January 2026.”
Requirements raise red flags
Beyond the loan offer, the letter listed several conditions applicants were required to meet, including Corporate Affairs Commission (CAC) registration documents, Bank Verification Number, National Identity Number slip, electricity bill, one passport photograph, Tax Identification Number, and at least six months’ bank statement from an active account.
Applicants were also required to pay “a registration fee of N13,000 for search and a customised ATM card.”
The registration fee, in particular, triggered criticism on social media, with many users questioning how a government-funded youth empowerment programme could demand upfront payment from prospective beneficiaries.
A Facebook user, Emmanuel Bassey, posted the letter on Facebook and tagged Agba Jalingo, the publisher of CrossRiverWatch.
“This is exactly how the rich get richer, and the poor get poorer,” Mr Bassey wrote. “Those who already have registered businesses, steady income, and spare cash will easily meet these requirements and access the loans. Meanwhile, the youths who truly need help are silently pushed out.”
He added, “True empowerment should remove barriers, not create them. Asking hungry and jobless youths to pay N13,000 upfront before receiving any support turns empowerment into a pay-to-enter system.”
‘An aberration,’ says Jalingo
Mr Jalingo had earlier shared the same letter on Facebook, describing the requirement as “an aberration.”
“The Cross River State Youth Empowerment Scheme is a programme funded with Cross River State money. It is meant to provide empowerment for young people in the state, devoid of the encumbrances that private and corporate business owners often lay out to militate the ambitions of young people,” he wrote.
Questioning the fee, he asked: “If after paying, the applicant is not able to get the loan, will the money be refunded?”
He added that “even commercial banks do not collect loan processing fees upfront,” noting that most banks charge about N1,000 for ATM cards and that credit bureau checks cost far less than N13,000.
Government steps in, orders suspension
Amid the outrage, the Cross River State Government ordered an immediate halt to all payments linked to the empowerment programme.
In a letter dated 8 January 2026 and signed by Enyong Amiokama, state coordinator of the People First Complaints and Solution Desk Office, the government said it had “received complaints of extortion, illegal taxation and fraudulent activities regarding your office’s ongoing empowerment programme.”
The letter stated that Governor Bassey Otu “condemned any form of exploitation of citizens” and directed the scheme to halt collections.
“You are directed to immediately halt all payments, including the N13,000 registration fees, pending clarification with this office,” the letter said, warning that “non-compliance will attract serious consequences.”
No extortion – Aruku
When contacted, Mr Aruku told PREMIUM TIMES nobody was being extorted. He said that it was a federal government loan, and that his agency was only mobilising people to access it.
“The loan is domiciled in Zenith Bank. To get the loan, you must have a corporate account with Zenith Bank. In the process of opening the account, the bank charges you N9,800 for the CAC charge.
“After that, the bank will give you an ATM card and the money left deposited in your account. The money is not paid to anybody,” he emphasised, adding, “It is deposited in the new account that applicants will open in Zenith Bank.”
He said no money comes to the state government or to his office.
Asked about the memo issued on the matter by the state government official, Mr Aruku said the official does not know her job and that there is an internal mechanism to address it.
The Commissioner for Information, Erasmus Ekpang, when contacted, said the state government was aware of the allegations and had suspended the scheme to give room for investigation and promised to brief the public on the outcome of the investigation.
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