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FG plans to disburse loans to MSMEs within 14 days

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By Sodiq Adelakun

In a bid to reduce the mortality rate of businesses waiting for loan approvals, the Federal Government is considering implementing solutions that will ensure the disbursement of loans to Medium, Small, and Micro Enterprises (MSMEs) within 14 days.

This announcement was made by the Senior Special Assistant to the President, Temitola Adekunle-Johnson during the Inaugural Job Creation and MSME Quarterly Communications Forum held in Abuja.

The government’s objective is to achieve a single-digit loan interest rate for MSMEs and make it the standard for small enterprises.

Adekunle-Johnson emphasised the importance of providing seamless and easy access to funding for SMEs. The current lengthy loan approval process, which can take up to six months, poses a significant risk to businesses, as they may fold up during this waiting period.

According to Adekunle-Johnson, the end point is to achieve a single-digit loan for MSMEs and ensure a single-digit loan becomes the norm for small enterprises.

He said, “We are trying to achieve a target of being able to guarantee seamless and easy access to funding for SMEs. We want SMEs to be able to apply for a loan and get it approved within 14 days at worst, and not in six months because some of these businesses can fold up within those six months of waiting for loan approval.

“The disbursements will be quick after the loan assessment is processed. That would help us reduce the bottlenecks of MSMEs running from pillar to pole looking for funding and not even having the collateral to achieve the loans.

“The end point is to achieve a single-digit loan for MSMEs. We aim to ensure single-digit loans become the norm for MSMEs.”

The government has announced a partnership with Access Bank to set aside N50 billion to support skills acquisition by five million Nigerians under the job creation initiative of the Federal Government called ‘YouThrive’ by Access.

The initiative is looking at empowering MSMEs in different ways by building their capacity, and access to affordable finance as well as digital, technical, and skill acquisition training for them.

Speaking on the initiative, the Head of Non-Financial Services, Access Bank, Chioma Ogwo, said participating small businesses would be empowered in different ways, including building their capacity and giving them access to affordable finance, besides providing them with the digital, technical, and skill acquisition training to thrive and create wealth.

“We are giving them affordable loans at 15 percent and free grants to deserving SMEs, who have done very well. We have a business exchange programme for the beneficiaries that would enable the SMEs to go and exchange ideas with their counterparts in other countries.

“We are looking at empowering four million in four years – one million yearly. 700,000 would be given as access to finance every year. We have also earmarked N50bn for this intervention and it will be reviewed after one year,” she enunciated.

Meanwhile, the Director-General of the Small and Medium Enterprises Development Agency of Nigeria, Charles Odii, disclosed that three million jobs were lost to flooding in Nigeria in 2023.

He did not give details on specific figures about the flooding that wreaked havoc on lives and properties.

He said the government had developed a technology to alert of an impending danger of flooding across the states, a development he said would help the government to take proactive measures to evict potential victims.

He said SMEDAN was helping to mitigate the challenges faced by MSMEs, especially production costs and low rent to enable them to be productive and support the economy.

According to Senator Ibrahim Hadejia, who is the deputy chief of staff to President Tinubu, MSMEs provide resilience and agility to any economy.

He added that a country with a robust MSME sector would have a buoyant economy and be able to adapt to some of the current global shocks.

“This kind of partnership with Access Bank is very important to growing SMEs. It is also important to look at the impact of technology on agriculture as a major contributor to the nation’s GDP growth rate.

“If we get it right, our yields on some of even our most common crops will improve. We need that to improve our output. It will also encourage the younger generation to participate,” he remarked.

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Naira will continue to appreciate against dollar – Shettima

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Vice President Kashim Shettima has expressed optimism that the Naira would continue to appreciate against the dollar at the forex market.

Spokesperson of the Vice-President, Mr Stanley Nkwocha, in a statement on Saturday, said Shettima stated this at a meeting with officials of the Lagos Chamber of Commerce and Industry (LCCI), at the President Villa, Abuja.

He said President Bola Tinubu ended the fuel subsidy and ensured the unification of the multiple exchange rate because the former arrangement was producing billionaires overnight.

“Naira went haywire and some people were celebrating but inwardly we were laughing at them because we knew that we have the leadership to reverse the trend.

“Asiwaju knows the game, and truly the Naira is gaining and the difference will drop further.”

He recalled that the quality of leadership provided by President Tinubu as governor of Lagos laid the foundation for the massive development witnessed in the state.

Shettima assured that the Tinubu administration is doing its best to address challenges in the power sector.

According to him, Tinubu’s administration is aware that power is absolutely essential for development.

“We are determined to ensure that we generate jobs for our youths. Honestly, the President’s obsession is to live in a place of glory, to transform this country to a higher pedestal.

“He wants to leave a legacy, one of qualitative leadership because the hope of the black man, the hope of Africa rests with Nigeria.

“I want to assure you that President Bola Ahmed Tinubu is one of you. He understands your ecosystem. In this government, you have an ally and a friend.”

Earlier, the President of LCCI, Gabriel Idahosa, emphasised the need for the Federal Government to consider more innovations to address the insecurity challenge in the country.

He also urged the Tinubu administration to ensure a significant upswing in the pace and scale of alternative policy measures that promote credit access, stimulate investment, and support entrepreneurship.

“This could include targeted interventions such as concessional lending facilities, loan guarantees, and interest rate subsidies tailored to the needs of SMEs and key sectors of the economy like agriculture, manufacturing and power technology.”

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LCCI advocates discipline, export to sustain Naira appreciation

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LCCI advocates discipline, export to sustain Naira appreciationThe Lagos Chamber of Commerce and Industry (LCCI) has emphasised the importance of maintaining discipline in the foreign exchange market to sustain the steady appreciation of the Naira.

The President and Chairman of the Council of LCCI, Mr Gabriel Idahosa, made the call in an interview with newsmen on Wednesday in Lagos.

Idahosa praised the efforts of the Central Bank of Nigeria in imposing discipline, attributing the recent Naira appreciation to curbing speculative activities.

“On the monetary side, the CBN is doing it. The primary efforts should continue to impose discipline in the foreign currency market.

“The abuses in the foreign currency market were prevalent and most of the fall in the value of the Naira in the last six months is not because there was any sudden calamity in the Nigerian economy.

“It was primarily because of very reckless speculations, that people were just speculating in the dollar, they had nothing to export, nothing to import, they were just buying the dollar for speculative reasons.

“And once the Central Bank started to impose discipline in the foreign currency market, we saw the value of the Naira rising very quickly by stopping speculation,” he said.

According to him, the strategies of the Central Bank, now, are designed to achieve a sustained discipline in the foreign currency market.

Idahosa highlighted the need to continue reducing the number of Bureau de Change operators, stressing that many operated without contributing to international trade.

He applauded the Central Bank’s move to enforce documentation and identification of buyers and sellers at BDCs, aiming to deter reckless speculation and curb illicit financial flows.

On the fiscal side, Idahosa urged President Bola Tinubu to prioritise a nationwide export drive, citing it as the key to bolstering the Naira and providing essential foreign exchange.

He emphasised the importance of fostering a culture of export among Nigerians across all scales of enterprise to reduce reliance on imports and strengthen the country’s economic resilience.

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Money market

Foreign reserves decline to $32.29bn

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The foreign reserve has depleted to $32.29 billion, which is a six-year low in the Central Bank’s course to save the naira.

This is the lowest level the reserves have been since September 25, 2017, when it was $32.28 billion.

The country’s foreign reserves declined by 6.2 percent, losing $2.6 billion since March 18, when the naira started its rebound from record-low levels against the dollar to $32.29 billion as of Monday, based on the latest available data from the CBN.

At the beginning of the month, the reserve was at $33.57 billion, then further dipped to $32.6 billion by April 12.

This comes as the CBN has attempted to save the naira through various interventions such as raising interest rates to 24.75 percent and managing foreign exchange trades.

It stepped up its intervention in the FX market with sales at both the official market and to BDC operators who sell dollars on the streets.

The apex bank, which sells $10,000 to each BDC every week, mandated them to only sell at a spread of 1.5 percent, which comes to N1,117 per US dollar.

The rate sold by the BDCs has set a defacto floor for the naira in the black market since the apex bank resumed sales to them in February.

Also, last month the CBN said it had cleared a backlog of $7 billion since the beginning of the year. That was built over the years as the central bank pegged its currency against the dollar, leading to a scarcity of foreign currency that deterred foreign portfolio investment. However, it’s unclear how much dollar debt the CBN retains on its books.

Akpan Ekpo, a professor of economics and public policy, said the CBN’s managed float system in which it is trying to ensure supply and curtail demand is not sustainable in the long term.

He said the CBN needs to be careful with how it depletes the foreign reserves as its main source is oil revenue.

“We need to manufacture non-oil goods and services, export them, and get foreign exchange and not depend on oil income,” he said.

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