Connect with us

Economy

SMEDAN Plans Microfinance Bank for MSMEs 2021

Published

on

SMEDAN

By Adedapo Adesanya

The Small and Medium Enterprise Development Agency of Nigeria (SMEDAN) has disclosed that it would soon establish a microfinance bank to support Micro, Small and Medium Enterprises (MSMEs) in the country.

The Director-General/Chief Executive of SMEDAN, Mr Dikko Radda, made this known during the week in Abuja at a media programme for the Commerce and Industry Correspondent Association of Nigeria (CICAN).

He also confirmed that the ownership of the proposed bank will be extended to some major players in the nation’s MSMEs sector, noting that SMEDAN was already in talks with the Central Bank of Nigeria (CBN) towards obtaining an operating licence for the financial institution.

Mr Radda explained that the need to set up a microfinance bank for the MSMEs became imperative as it was becoming increasingly difficult for operators to attract funding from conventional banks.

He described the interest rate obtainable from normal microfinance banks as too high for most MSMEs, saying with such a high lending rate, it would be practically impossible for businesses to survive in Nigeria.

The SMEDAN boss said barring any change in plans, the bank would become operational by next year and would be owned by SMEDAN and MSME operators.

“We are in the process of establishing our own microfinance bank that will enable the Nigerian MSMEs to have direct access to credit with a very simplified and modern means of achieving that.

“The interest rate of the conventional banks is unbearable because it is over 20 per cent and we are working hard to establish a microfinance bank,” he said.

Speaking further, the SMEDAN boss said the agency has also partnered with the Bank of Agriculture (BoA) to provide matching funds for MSMEs, adding the move was part of SMEDAN’s efforts to reposition the sub-sector for better performance.

He said the matching fund would enable SMEDAN and the Bank of Agriculture to contribute in a certain proportion for MSME financing at a single-digit interest rate.

His words: “We have gone into an MoU with the Bank of Agriculture to provide a Matching Fund. SMEDAN will contribute a certain amount and then the Bank of Agriculture will also provide a certain amount of money to enable us to provide loans to MSMEs.

“This is bearing in mind the fact that one of the major challenges of MSMEs is funding and most of the requirements provided by the commercial and even development banks in Nigeria are very high for the MSME to achieve.

“So we will provide this matching fund so that we equally reduce the requirements to enable MSMEs benefit from that fund and SMEDAN has forfeited its own part of interest from the money it is contributing as a matching fund to bring down the interest rate to single digit. This will enable us to help the MSME make up the challenge under the facility.”

Adedapo Adesanya is a journalist, polymath, and connoisseur of everything art. When he is not writing, he has his nose buried in one of the many books or articles he has bookmarked or simply listening to good music with a bottle of beer or wine. He supports the greatest club in the world, Manchester United F.C.

Click to comment

Leave a Reply

Economy

CBN Adds New Feature to Yet-to-be-Launched eNaira

Published

on

eNaira

By Sodeinde Temidayo David

The Central Bank of Nigeria (CBN) has announced that the yet-to-be-launched eNaira will have a new add-on that will enable users to complete transactions with mobile phones without Internet capability.

The apex bank, in a document titled Design paper for the eNaira, disclosed that maximising the value and use cases of the nation’s digital currency would depend largely on devices with Internet capabilities.

A few months ago, the CBN said it would launch eNaira on October 1, 2021, but it later suspended this without giving a new date for the unveiling.

This digital currency, which is expected to promote the cashless policy, is expected to become operational after the central bank stopped the trading of unregulated digital currencies in the country like Bitcoin, Ethereum and others.

The eNaira is to be introduced into the country under the Central Bank Digital Currency (CBDC), an electronic record or digital token of the local currency and is to be issued and regulated by the monetary authority.

Given the reason, the CBN noted that, “The eNaira thus risks further alienating sections of the population who are uneducated, lack exposure and access to internet services or digital devices.”

The apex bank is adding the new feature to the eNaira following a recent publication that estimated that 35 per cent or about 37.1 million of the nation’s adult population was illiterate.

To face the risk of losing adoption of the digital currency to this segment of the population, the CBN added that the bank has factored in the need for inclusiveness as part of the core design principle of the eNaira.

According to the central bank, this principle has enabled the bank to focus on simplicity and ease on the use of the e-Naira, to ensure that Nigerians without Internet-enabled phones can access the digital service.

The CBN said the eNaira would complement existing payment options available via the mobile banking apps, Point of Sale (POS) terminals, Unstructured Supplementary Service Data (USSD), quick response code and Internet banking, among other channels.

GSMA, a global industry organisation that represents the interests of mobile network operators, had said in a recent report that 19 per cent of people living in Nigeria do not have access to mobile broadband coverage.

In its design paper, the central bank, in a bid to ensure inclusive access while also ensuring the integrity of the financial system, has chosen the account-based CBDC model for the eNaira.

The CBN said, “The account-based CBDC model at its core mirrors the progress made on the National Financial Inclusion Strategy which enables access to financial services by leveraging last-mile networks to identify users and to provide banking services through channels such as PoS and USSD.

“With the account-based model, the CBN seeks to enable access by leveraging the existing identity infrastructure in Nigeria such as the BVN, NIN, TIN, etc., to uniquely identify individuals and corporate entities.

“Specifically, identity frameworks such as the NIN will enable access for the financially excluded as they can be uniquely identified, thereby enabling the provision of financial services. These identity systems will help ensure a robust KYC framework positioned to enable access for all Nigerians.”

The CBN also added that this would help improve cross-border payments and address issues of dollarisation of the economy, as it could be recalled that Visa, a payments company, recently noted that the ease of operating CBDCs would determine the success of digital currencies.

Continue Reading

Economy

Nigerian Exporters Fail Due to Poor Training, Exposure—NEPC

Published

on

Nigerian exporters

By Ashemiriogwa Emmanuel

The Nigerian Export Promotion Council (NEPC) has revealed that many Nigerian exporters, including women entrepreneurs, fail in the international market as a result of poor training and exposure to the business.

According to the federal agency, it is necessary for anyone who wants to venture and succeed in the business to undergo adequate training in order to grasp the scope of the competitive venture.

The Executive Director/CEO of the NEPC, Mr Olusegun Awolowo, disclosed this at a capacity building workshop organized for women-owned businesses in the non-oil export value chain in Akure, Ondo State on Friday, October 15

Speaking at the event, which was organised by the Export Development and Incentive Department of the NEPC, Mr Awolowo said that, “Lack of export market training is one of the major reasons Nigerian exporters fail in the international market.

“Exporters need to learn the specific requirements of the target markets as well as the certification needed for the product to be exported.”

Represented by the Head/Trade Promotion Advisor at NEPC Akure, Mr Macpherson Fred-Ileogben, the agency’s head noted that it was for this reason that the council decided to organise the workshop.

The training featured coaching and networking sessions to give women entrepreneurs the opportunity to improve their knowledge of competitiveness in the export market.

He cited that the involvement of women in trade will not only promote gender equality but also increase the growth potential of the nation.

As a result of the gradual recovery from the global pandemic, players in the non-oil exporting business into the international market have been tasked to think outside the box to ensure continuity.

To realize this, it would be recalled that the agency also organized a sensitisation workshop in Lagos in September 2021 which was themed Earn Dollars by Selling on Amazon to help stakeholders see the opportunities in leveraging e-commerce.

Continue Reading

Economy

Investors Lose N24.3bn at NASD Bourse in One Week

Published

on

NASD OTC Bourse

By Adedapo Adesanya

The 41st week of trading at the NASD Over-the-Counter (OTC) Securities Exchange closed with a N24.3 billion loss largely as a result of the exit of the Nigerian Exchange (NGX) Group Plc from the platform.

According to the weekly NASD market review and analysis by Business Post, the market capitalisation dropped to N616.99 billion from N641.28 billion in Week 40.

NGX Group Plc exited the bourse as it listed its stocks by introduction on the floor of the Nigerian Exchange (NGX) Limited, which is its demutualised exchange.

On the other hand, the NASD Security Index (NSI) rose in the week by 1.22 points to close at 746.8 million in contrast to 737.80 points of the preceding week.

Data showed that the market saw a 500.6 per cent increase in the total value of transactions in the week to N584.5 million from N97.3 million, while the total volume of trades rose by 10,546.9 per cent to 1.1 billion units from 10.3 million units, with the number of deals decreasing by 63.6 per cent to 40 deals from 110 deals.

During the week, there were two price decliners and two price advancers on the NASD bourse with the losers led by Central Securities Clearing System (CSCS) Plc as a result of the 2.4 per cent fall it posted to settle at N16.60 per share compared with the previous rate of N17.00 per share.

Also, Niger Delta Exploration and Production (NDEP) Plc went down by 1.0 per cent to trade at N245.00 per unit in contrast to N247.50 per unit of the preceding week.

On the gainers’ side, Afriland Properties Plc topped with a growth of 8.6 per cent to finish at N1.14 per share compared with N1.05 per share of the earlier week, while FrieslandCampina WAMCO Nigeria Plc gained 8.5 per cent to trade at N128.00 per unit versus the previous week’s N118.00 per unit.

Lighthouse Financial Service Plc was the most traded stock by volume with 1.1 billion units. It was followed by UBN Property Plc with 3 million units, First Trust Microfinance Bank Plc with 2.1 million units, CSCS Plc with 853,000 units, and NASD Plc with 721,000 units.

Also, Lighthouse Financial Service Plc was the most active by value with N544.2 million, CSCS Plc followed with N15.0 million, NDEP Plc traded N10.3 million, NASD Plc exchanged N8.4 million, while UBN Property Plc transacted N2.9 million.

On a year-to-date basis, investors have traded 12.8 billion securities worth N29.7 billion in 4,564 deals.

Continue Reading

Like Our Facebook Page

Latest News on Business Post

Trending

%d bloggers like this: