The Central Bank of Nigeria has said that Micro, Small and Medium Enterprises need more funding because they are important in the growth of the nation’s economy.
The Apex Bank took this position at the 3-day workshop on the N220 billion Micro, Small & Medium Enterprise Development Fund organised by the Bankers’ Committee’s sub-committee on Economic Development, Sustainability & Gender in collaboration with the CBN.
According to the Director, Development Finance Department of the CBN, Dr. Mudashiru Olaitan, represented by the Assistant Director, MSME Development Fund, Mr. Tobin Jonathan, “The rejection rate of MSME application by commercial banks is very high. We are aware this is necessitated by the banks’ aversion to risk due to lack of entrepreneurial skills and poor governance structures of most MSMEs, hence the need for the workshop to enlighten the bankers and encourage them more on the need to partner with us on the need to grow the sector.”
The Project Manager of the International Finance Corporation (IFC), Ubong Awah also added that IFC is collaborating with CBN to establish a National Collateral Registry to stabilise MSME financing in the country.
Awah said “As an organisation, IFC is bringing the experience we have garnered over the years across geographies to bridge the knowledge gaps and to lay emphasis on the fact that globally, collateral for MSME is moving away from fixed assets to movable assets, hence the need to establish a collateral registry for the financial industry. We are excited to partner with Central Bank on this initiative.”