To stimulate access to finance by MSMEs, Nigerian Federal Government has said that Small and Medium Enterprises (SMEs) can now use their movable assets to secure bank loans instead of landed property.
Senior Special Assistant (SSA) to the President on Industry, Trade and Investment, Jumoke Oduwole disclosed this while addressing operators in the sector at a public event in Lagos.
Oduwole said that the National Collateral Registry Bill which was recently signed into law by the government is designed to stimulate access to finance by Micro, Small and Medium Enterprises (MSMEs).
“85 percent of SMEs in Nigeria contributes 50 percent to Gross Domestic Product, GDP. The government wants to encourage you to flourish, to produce more and add value to non-oil exports,” she said.
Earlier, CBN Governor, Godwin Emefiele, in an NCR Newsletter, stated: “There is empirical evidence, that the establishment of collateral registries has increased lending to MSMEs in other jurisdictions.
She said, “I am hopeful that the commencement of operations of the NCR will have a tremendous impact on MSME lending in Nigeria, as we strive to increase lending by banks to the sub-sector to about 10 percent from 0.067 percent in the next few years.
“I am happy to note that the strategy is yielding positive results. As at August 24, 2017, 136 financial institutions, 22 commercial banks, 106 microfinance banks, one non-bank financial institution, three merchant banks, three development finance institutions and one non-interest bank have registered 16,236 financing statements for 20,684 movable assets on the NCR platform, valued at N392 billion, particularly the microenterprises, which are about 99 percent of the 37.1 million MSMEs in the country,” she said.