. Vows to promote MSMEs competitiveness
The Small and Medium Enterprises Development Agency of Nigeria (SMEDAN), yesterday, said it will begin the operations of its microfinance bank early 2023.
The Director-General of SMEDAN, Olawale Fasanya, disclosed this in an interview with the News Agency of Nigeria (NAN) on Sunday in Abuja.
Fasanya said the SMEDAN micro finance institution will contribute in addressing the challenge of access to finance, a major impediment to the growth of Micro Small and Medium Enterprises (MSMEs) in the country,
“We are in the process of launching a micro finance institution which will be lending at single digit interest rate.
“It will be private sector-run but we will be on the board so that we will be able to checkmate abuses and know how it is being run,” he said.
Fasanya said that money has been set aside to get the licence for the bank, and they will partner with some business member organisations to bring in funds to capitalise the micro finance institution.
“We believe that as time goes on, we will get donor groups and some other areas that we will be able to source funds that will not come at high cost and we will be using part of our own funds to reduce the interest.
“We have met all the Central Bank of Nigeria (CBN)’ requirements and once the licence is out, we will start almost immediately,’’ Fasanya assured.
The D-G raised concerns over the high interest rates charged by some banks from MSMEs operators.
According to him, access to funds has been a major impediment to the take-off of MSME after building the capacity of entrepreneurs.
“The funds are there, but access is the problem because of the rigorous requirements it takes to get funds from money deposit banks and the high interest rate.
“We may, however, not blame the micro finance institutions, because where they source their funds comes with a cost and it is that cost that they transfer to borrowers,” he said.
The D-G underscored the need for the commercial banks to grant access to funds to new MSMEs and viable start-ups with single digit interest rate for the growth of the sector and the economy at large.
We are in the process of launching a micro finance institution which will be lending at single digit interest rate. It will be private sector-run but we will be on the board so that we will be able to checkmate abuses and know how it is being run.
MSMEs competitiveness
Fasanya also pledged to promote policies that will enhance the competitiveness of MSMEs, adding that SMEDAN is intensifying synergy with some relevant government agencies to enhance the competitiveness.
He said: “We are currently interfacing with the National Agency for Food and Drug Administration and Control (NAFDAC), to enlighten MSMEs on product registration and certification.
“We would have strategies to ensure MSMEs can register good products without tedious functionalities. One can apply online for NAFDAC product certification and officials can come in for inspections.
“We are going to train our staff in all the 36 states and the Federal Capital Territory (FCT) in conjunction with NAFDAC officials so that MSMEs can easily register their product,” Fasanya said.
He argued that collaborations with the Nigerian Export Promotion Council (NEPC), is a priority to ensure MSMEs key into the African Continental Free Trade Area (AfCFTA).
“We are working to make sure products that are export ready can be assisted to participate in AfCFTA, and we are also going to enlighten MSMEs on necessary requirements to be a part of AFCFTA,” he said.
According to Fasanya, an upgrade to SMEDAN credit information portal has recently been concluded thus providing information at the fingertips of MSMEs.
“MSMEs do not need to go far to get needed information on loans and credit. Every information needed is available on the portal. Information on banks who now give loans without collateral can also be found on the portal and some MSMEs are not aware,” he said.
Fasanya further said that dialogue with stakeholders led to the review of MSMEs initiatives and programs to meet the need of end users nationwide.
“It is a part of the cardinal points to see to the implementation of the National policy on MSMEs to the later.
“It will also serve as a guide to activities geared at meeting up with priority areas within the implementation matrix.
“Our programs such as One Local Government One Product (OLOP), the Conditional Grant Scheme (CGS), the Matching Fund Program (MFP) and many more are geared toward facilitating the growth of MSMEs,” Fasanya said.
