Loan recoveries, topmost challenge for MfBs — MD, Eso-E Microfinance Bank

In this interview by BANKOLE TAIWO, the Managing Director of Eso-E Microfinance Bank, Sagamu, Mrs. Olowookere Mosunmola speaks on the unquantifiable impact of microfinance banks in helping to fight poverty at the grassroots, the topmost challenges of loan recoveries and the need for further support of the government for MFBs to empower more rural dwellers.

Let’s get to meet you ma

I am an Accountant by training. I became the Managing Director of this foremost and the best Microfinance Bank, Eso-E Microfinance Bank on the 17th of March, 2021. I actually joined the bank on July 1st 2009 as the Head of Account/MIS and from that time I have worked at different departments of the bank. I was for six years the Internal Auditor, thereafter, I became the Head of Operations and from there I assumed my new office as the Managing Director of the Bank. I am happily married with kids.

How has it been like since taking up this new role as the one seeing to the day-to-day running of the bank?

It is additional responsibilities to what one has been doing before having been with the bank since 2009. Really, it has come with its challenges but God has been helping us, particularly, in the area of operations. The staff have also been adjusting and coming to terms with the reality that yes, a new hand is here to lift the bank higher and help it to further serve the people. The bank has also left where it used to be before I assumed office. Our customers base has increased greatly, likewise our shareholders. In terms of loan recoveries, we have also made appreciable progress and we intend to do more. I must sincerely appreciate the staff for their commitment because for whatever success we have achieved so far, they have been the foot soldiers, the good Lord bless them all.

For how long has this bank been operating now?

That should be 28 years. It started as a community bank in 1993 and transformed into Microfinance Bank in 2008 due to Instruction from Central Bank of Nigeria (CBN). From 2008 to 2013, we were operating as a unit Microfinance Bank but from 2013 due to our growth and increased capital base, we became a State Microfinance Bank. The CBN is currently asking that we should re-capitalise again to the tune of N1bn and we are trusting God to help us. We are already speaking to investors and making other moves to ensure that we comply with this CBN directive. It is just that the money is much, thankfully, CBN has extended the deadline to April 2022, so, we will double up our efforts to meet with this deadline so that we can remain a State Microfinance Bank

Will you say Eso-E Microfinance Bank is fulfilling the purpose for which it was set up?

Absolutely yes, and this gives you sense of fulfilment and joy when you see how lives are being transformed because they came seeking for help from the bank in form of loans and our other products and the bank was able to assist them. You know that, microfinance bank was set up to combat poverty, give rural dwellers financial support, to support the active poor and give them wings to fly and this Eso-E Microfinance Bank has been pursuing. We have those who started with N50,000 loan with us that are now going for N1M and above because of the growth and the expansion that their businesses have witnessed, they are now living better lives and the bank itself is growing. We have assisted many to be owners of tricycles which they use to earn their daily living, the impact of microfinance bank in fighting poverty and raising standard of living among the rural dwellers can’t just be overemphasized. To reach more people, we have what I can call as our meeting point at Ikenne, Ogijo, Mowe, Abeokuta and Makun, Sagamu.

How do you think it can get better? Are you getting any support from the government?

The only support we are getting from the government has to do with recovery of loans. For instance, if any civil servant is playing pranks with payment of his/her loan, the government when notified helps to ensure that such loan is recovered. Aside this, no other support like putting down fund for the bank to operate or disburse to the people who need it in form of soft loan. Now, we are being asked to re-capitalise to the tune of N1bn, how do they want us survive?

The country is just coming out of the COVID-19 pandemic, will you say business is bouncing back?

Yes, business is gradually getting back, we are recovering our loans and we trust God that things will get better.

There is a COVID-19 intervention fund to support small businesses from the CBN, has your bank benefitted?

Nothing of such, the last time we received something of that nature was in 2013. We received N50m from the CBN and paid back. After finishing the payment, we requested for another one but we were not given. We surely need support like this to serve our people the more. We expect such support from the state and the federal government.

How about issues relating to taxation?

There is a big issue there when we look at all manner of returns that we file to the government. You talk of signage, land use charge and the rest, if we use all that we are making to pay taxes, what do we give our shareholders and investors as returns for their investment? Do not forget that we are going to pay the workers, pay for other bills. Sometimes, after you think that you have have paid, another set of people will come around and said you have just paid into the wrong hand and these are people who will come with government receipts, how do you now differentiate the fake ones? They will come with government identity cards too, state government really should look into this. Another thing I also want to plead for is that whenever there is any change in our laws, government should please endeavour to notify us on time. Like the one we experienced when we filed for CAC, we usually do this physically, we never knew the filing has now been made online and when we wanted to the last one we were penalised, this is really not good because when it comes to filing tax returns, our bank has always been very compliant, so, we should not be allowed to suffer for no fault of ours.

Why should I bank with Eso-E Microfinance Bank?

You have to bank with us because it is always our joy to see our customers so happy and pleased and that is why we do all that is within us to ensure customer’s satisfaction.

For instance, our interest rates are the lowest being charged by microfinance banks, our documentation is also very minimal because we are now in the era of technology, and so our operation is seamless. If you need to open saving account with us, we pay interest on that account. We have ATM, we have mobile banking apps, we have USSD code. Banking with us is at your fingertips, you can bank with us from anywhere in the world. As someone whose salary account is domiciled with us, you have access to loans, asset loans and many others all of which are tailored to ensure that life remains beautiful for our customers. Even if your salary account is not domiciled with us, we support you too as entrepreneurs and business men and women. We have agric loans too which we call agricplus for fish farmers, poultry farmers etc.

What will you term as challenges when it comes to banking at the grassroots?

It is the issue of loan recovery, it’s been challenging and tasking. Many of our people will take loans and disappear, they will say it is the government money, locating them and their guarantors will now become a challenge. The state and federal government should please assist us to further enlighten the public on this, that microfinance banks are investments of some other people and not a place set up to dole out free money. The civil servants who surely know better are also not helping us. Some will take loans after which they will seek for transfer, locating them then becomes an issue. Some will even move their salary accounts to another bank. However, government has proved to be helpful in this area because once the appropriate authority is notified, such civil servant is called to order.

How can government further support you?

Government should encourage the civil servants to bank with microfinance banks because all the services that they used to complain of before, such as the use of ATM, online banking are now available with most of the microfinance banks. We are even doing it far better than some of these commercial banks, so, we want more of government patronage too. You also don’t get to hear issues of hacking of account with microfinance banks because of some of the checks and controls that have been put in place.

What is your message to your customers and residents of the state?

It’s a new beginning for us at Eso-E Microfinance Bank, it’s a new management and the bank is getting better for it. The bank is no longer where it used to be, it has continued flourishing as the staff and the entire management are more committed to ensure that the bank keeps on working towards supporting prosperity of the rural dwellers. Accessing our loans are quite seamless while the re-payment plan has also been made very flexible. We are there for them and always ready give them wings to fly.