This, however, has not been the case in
For instance, Vice President Mohammed Namadi Sambo recently decried the high rate at which commercial banks charge interests which hamper access to financing by small and medium scale entrepreneurs.
The Vice president reportedly made this observation at the
Sambo said lack of access to financing remains one of the stumbling blocks to the growth and development of SMEs in
The SMEs, he explained, thereafter end up supporting the banks by increasing their liquidity, urging the
Sambo further stated that the Federal Government has a robust national master plan for small and medium scale enterprises adding that, he sought ways to see how the IDB would provide direct financing support for the small and medium scale entrepreneurs in the country.
He also noted that the current rebasing of
The Vice President added that with the successful completion of 10 new thermal power plants in the country, there was also the need for adequate gas infrastructure to support industries in the country, calling on the bank's support in financing both gas and transportation infrastructure to allow for local processing and transportation of gas within the country.
Sambo called for the bank's support in realizing several other power and agricultural projects and programmes, which the administration was currently executing, including the Gurara Phase II 260mw hydro power project; the 3050mw larger Mambila hydro-power project, the
The Chairman of the
He noted that at the moment, the bank was engaged in a gas pipeline project that would connect the southern and northern parts of Cote D' I'voire, which is at pilot stage and that they hope to also work with
He further noted that the
Similarly, the Central Bank of
The CBN governor,
Emefiele said that in spite of global recognition, MSMEs in
He said a joint report by the
The governor said the CBN initiated the funds as an innovative way of improving access to finances at single digit interest rates by MSMEs in order to unlock their potentials and unleash them for growth.
He said state governments would be able to access up to N2 billion each for on-lending to eligible beneficiaries through participating financial institutions in their states.
He also said 60 per cent of the funds would be given to women, who often turn out better yields than their male counterparts.
According to him, the CBN would be committing considerable human and material resources to monitoring the disbursement and utilisation of the funds in a robust and verifiable manner.
"Participating financial institutions will be required to submit periodic returns on disbursement as well as analysis of the social impact of these funds on our people," he said.
He implored the state governors to assist the CBN to achieve its goals by ensuring that the funds were deployed in an efficient manner to beneficiaries.
Akwa Ibom State governor,
Akpabio, however, stated that the N220 billion set aside for the initiative was relatively small, considering the size of the country, the rate of unemployment and its economic potentials.
He urged the CBN to review the procedures involved in the disbursement of the fund to enable it get to the targeted population without difficulties.
Oyo State Governor, Abiola Ajimobi, on his part urged the CBN to carry out needs assessment of the states to establish their real needs, adding that the number of MSMEs varied from state to state.
Ajimobi said there was the need to disburse the funds according to the size and needs of the MSMEs in various states of the federation.
Uduaghan said if microfinance banks were encouraged to handle the funds, more jobs would be created at the grassroots and more people involved in economic activities at the local level.
The governor stated that if about 50 million youths in the country were involved in economic activities, the country's earning would be increased.
Meanwhile, Head of SME,
He noted that due to the nature of the segment, SMEs were usually poorly capitalized with little or no assets, noting that a big barrier to funding was usually the lack of tangible collateral.
He said another big challenge is the absence of accurate and verifiable financial statement, with which formal lenders evaluate the credit worthiness of the borrowers.
To solve this, he said lenders need to develop non-traditional methods to evaluate borrowers in this segment, and leverage on available clusters like cooperatives and market associations to provide comfort to the lenders.
He said lenders must also identify that finance must be supported with the right level of technical assistance, noting that the most successful lending models werre usually those backed by the right level of technical assistance to ensure the borrowers maximize the funding provided.
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