Cabinet calls on banks to provide more loans to SMEs – The Sun Nigeria
By Merit Ibe
Manager The Director of Bullion Go-Neat Global Ltd, Mr. Olufemi Ajadi, has urged Nigerian banks to create more lending facilities to support small and medium enterprises (SMEs) in the country.
Ajadi, who recently spoke at a forum of the Association of Trade and Industry Correspondents of Nigeria (CICAN), said the move would not only help the capacity of Nigerian-run businesses, but would also help stimulate the economy.
He pointed out that financial support remained essential for the survival of SMEs, but that the government and its agencies did not seem to appreciate it.
Ajadi said the current situation in which emerging small businesses are allowed to suffer due to lack of finance does not bode well for the economy, saying it is worsening the unemployment situation and contributing to soaring jobs. prices of goods and services.
The MD said that as companies are forced to source capital from traditional banks, at typically high interest rates, they could sell at low prices.
He said small and medium-sized enterprises (SMEs), seen as the engine of growth, could only play such roles when supported by the government at the start-up stage.
“I believe the government can really help SMEs in Nigeria, after all these SMEs help the economy. SMEs help create jobs, provide goods and services and should be supported by government.
He cited examples with other countries saying that many of them were ahead of Nigeria because they had taken time to support their SMEs.
Ajadi was of the view that registration procedures could be simplified for Nigerian start-ups rather than the current situation where they face multiple taxes. While acknowledging that some banks were trying to lend to businesses, he said conditionalities could be simplified.
“If you say that certain banks give loans, how many companies have had access to these loans and what are the conditions? “I still believe that if the government could show interest in supporting Nigerian businesses, they would give Nigerian banks strong mandates on this.
“Any bank that does not follow such a directive could be sanctioned.
“If Nigerian SMEs are effectively supported through the provision of small loans, they increase their capacity, create more jobs and help fight hunger and insecurity,” he said.