NIGERIA’S minister of state for trade and industry Mariam Katagum has challenged the country’s financial institutions to start offering single digit loans to small and medium enterprises in a bid to get the economy diversified.
Essentially a mono-economy, Nigeria is heavily dependent on crude oil for its survival as the commodity accounts for about 90% of government revenue. Over recent years, there have been renewed attempts to diversify the Nigerian economy with sectors like agriculture, solid minerals and manufacturing seen as key.
However, small businesses find it hard to get going giving the high cost of finance in Nigeria, prompting Mrs Katagum to plead for accessible financing for the Micro, Small and Medium Enterprises (MSMEs) at single-digit interest rate. She tasked the financial sector to continue to support the federal government’s initiatives to boost affordable financing to small businesses by granting cheap credit to the MSMEs sector at single digit.
Speaking at the virtual Ecobank MSME and Financial Inclusion Summit themed Unlocking Credit Growth in a Changing MSME Lending Landscape, Mrs Katagum said small businesses are partners in progress. While praising the organisers, she said the event came at a time when the present administration is strategically repositioning the MSMEs landscape towards achieving its full potentials with a view to contributing more to the economy.
Mrs Katagum said: “I charge Ecobank and the financial sector as a whole, to continue to provide the much-needed support for federal government initiatives by facilitating and granting accessible financing for the MSME sub-sector, at single digit. I repeat at single digit.
“The federal government has overtime created platforms to improve access to finance for MSMEs in order to boost production, increase the value of trade, enhance the investment climate, and foster innovation and entrepreneurship. This is in addition to the deliberate and pragmatic policies geared towards supporting and sustaining small businesses in the country, thereby equipping entrepreneurs to compete globally, especially under the Africa Continental Free Trade Area Agreement.”
She added that small businesses remained the driving force behind structural changes and sustainable economic growth and development, particularly with respect to their contributions to job and wealth creation. Mrs Katagum added that these enterprises play a significant role in the economy and are crucial drivers of innovation and competition in many sectors.
She added that these initiatives also highlighted the importance of digital technology in promoting enterprises and sustainable industrialisation for economic growth. Mrs Katagum further explained that in a bid to guarantee continuity in support of MSMEs in the country, the government had harnessed the prime policies of the Economic Recovery and Growth Plan and the National Enterprise Development Programme into the Nigeria Economic Sustainability Plan in order to sustainably create an enabling environment for businesses to thrive.