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Tag: SME

  • Five ways to finance your SME

    Small and medium-sized businesses, often owned by a single person or a small team of entrepreneurs, are a driving force in job creation and local economic development. They provide much of the essential goods and services for poor people and their communities.

    Financing small and medium-sized enterprises (SMEs) is challenging for financial institutions for a number of reasons, but especially because a lack of information makes assessing and serving this sector difficult and expensive.

    A number of factors affect SME financing. Some developed countries take a capitalistic approach with little government incentives for SME financing, while others use government guarantees and other measures to reduce risks and costs. In emerging economies, to date, most SMEs (including formal sector firms) are financed from sources outside the formal financial sector, which is expensive for the enterprise and can hamper the flow of financing, thus hindering its growth. New capital requirements and banking regulations imposed on financial institutions worldwide are making the financing of SMEs even more difficult and expensive.

    Against this backdrop, the emergence of alternative, technology-enabled means of financing, such as new business models based on advanced data analytics, supply chain- and e-commerce-based finance, crowdfunding and other innovations may offer a way out of the information/cost trap.

    The World Economic Forum’s Global Agenda Council on the Future of Financing & Capital aims to foster the flow of financing to the real economy, with a particular focus on finance for SMEs.

    This will involve, among other things, innovations in:

    • Supply-chain financing and government procurement
    • Use of technology to reduce risks, enhance efficiency leading to lower costs
    • Securitisation and other means of obtaining capital relief for traditional sources of finance
    • Introducing non-traditional sources of long-term capital
    • Capacity building for both financiers and SMEs

    However, perhaps even more important is the need to catalyse exchange of knowledge, expertise and experience from both the demand and supply sides. Sharing the same approach to common issues, identifying best practice, replicating excellence – wherever that may be – should help create scale and momentum.

    To this end, the SME Finance Forum has taken early steps to create a focal point for this sort of exchange and networking. Established by the G20 (and presently managed by the International Finance Corporation), its web and social media presence already generates active discussion among its several thousand members.

    Specialist forums of this kind could significantly bridge the knowledge deficit in SME finance. With a critical mass of members and visible support from some of the largest financial institutions across the world, such a forum could foster a virtuous cycle of knowledge, leading to a greater flow of funds to SMEs.

    • Culled from: World Economic Forum

  • Why SMEs cannot get BoI loans, by NASME

    Many Small and Medium Enterprises (SMEs) cannot get Bank of Industry (BoI) facilities because of the lengthy process, the Nigerian Association of Small and Medium Enterprises (NASME) has said.

    Its Senior Special Technical Adviser, Mr. Chris John Mamuda, said in Lagos that most SMEs did not understand the processes.

    “Everybody just believes because that the government says there is money for loan, you just go and collect without any proper documentation and planning.

    “For instance, if BoI wants to give loans, there are certain processes involved – ranging from the purpose of the loan and the collateral involved to other demands which you must meet. However, most enterprises don’t want to go through this process; that is the lack of understanding,” he said.

    He said BoI’s interest rate is at nine per cent while commercial banks are at 22 per cent, and with commitment fee from BoI, it may be 10 per cent.

    “However, with moratorium from them, they can say you have  six months’ grace before you start repaying, but the problem is, most of these business operators still do not understand and that is why we have huge unpaid loans even from BoI. Sometimes the loans favour foreign SMEs more than the local ones,” Mamuda said.

    He said over the years, SMEs have contributed to the gross domestic product (GDP) of the country and added value to products.

    He added that SMEs have created jobs and promoted economic diversification scheme of the Federal Government.

    He, however, said all these do not come without challenges, adding that these challenges are still inhibiting the sector’s capacity to contribute to the economy.

    He said: “The challenges are many, but I categorise them into two: internal and external. The internal challenges range from poor organisational skills, inadequate record keeping and data to know new business trends and how to catch up with international standards. There is also poor development and product packaging skills. We all know very well that you can’t grow a business when you’re not abreast with global trends and also when you don’t have adequate data to know what is in demand.

    “The external challenge is  where regulation, multiple-taxation, absence of business advisory support and access to loans come to play. Taxes being charged on SMEs are not encouraging, and also advisory support from the agencies is not available. Access to start-up loans is a huge challenge as there is lack of understanding of the procedures of securing such loans by the SMEs.”

  • CBN begins N26b agribusiness, SMEs cash disbursement

    The Central Bank of Nigeria (CBN) yesterday commenced the disbursement of N26 billion Agribusiness/Small and Medium Enterprises Investment Scheme (AGSMEIS) fund contributed by all deposit money banks to finance eligible projects, CBN Governor, Godwin Emefiele said.

    Speaking at a ceremony to commence disbursement of the fund, he said lenders contributed five per cent of their annual Profit After Tax (PAT) annually to the AGSMEIS fund which is expected to exceed N60 billion by June this year.

    He said: “I am therefore very delighted that we have come to this stage where we are ready to begin the disbursement of these funds to deserving beneficiaries. These beneficiaries are youths who have been trained on various entrepreneurship, vocational and management skills across the country by Entrepreneurship Development Institutions and Centres, such as Fate Foundation, Lagos Business School, House of Tara and Thrive Agric,” he said.

    Emefiele said that upon completion of their vocational training, the specific implements needed to practice their vocations, are procured under the scheme. The beneficiaries’ details including their Biometric Verification Numbers (BVN) are forwarded to the deposit money banks to confirm that they are their customers before accessing the fund.

    He said the commencement of funds disbursement under the AGSMEIS continues a tradition of voluntary initiatives by the Bankers’ Committee to promote developmental programmes for sustainable economic growth.

    ”In designing the AGSMEIS, the Bankers’ Committee engaged with key stakeholders and relied on anecdotal evidence and lessons learnt from the implementation of the SMEEIS. Pivotal to such lessons, is that during a business life cycle, different types of financing are required, at the birth of the business, initial growth stage, expansion and mature operations phases,” he said.

    In line with this, AGSMEIS has been designed to be implemented in three (3) broad components, namely Direct, Indirect and Developmental components. Under the Direct component of the AGSMEIS, beneficiaries can access loans to a limit of N10 million, at interest rate of five per cent per annum and a maximum tenor of up to seven years.

    There is also a moratorium period of 18 months on principal and 6 months on interest element, depending on the nature of the business. However, it is mandatory that all loan beneficiaries must have valid Bank Verification Number, which shall be registered on the National Collateral Registry and used to track repayments and blacklist any defaulters.

    He said the five per cent per annum being offered under the AGSMEIS further attests to the unflinching commitment of the deposit money banks to support entrepreneurs to actualize their dreams and ensure that the twin goals of increased employment and poverty reduction are attained.

    Under the Indirect component of the Scheme, beneficiaries can access equity and quasi-equity investments of up to 10 years with an initial lock up period of three years before divestment.

    Emefiel said the challenges of youth unemployment and restiveness in Nigeria must be confronted with strategic innovative thinking to provide sustainable solution.

    “No matter how daunting the challenge might seem, I believe that with unity of purpose we can fight this scourge together. There is no gainsaying the fact that one of the most effective ways to tackle this scourge, is through entrepreneurship development and easy access to affordable financing. Yet, access to finance has been an Achilles heel on entrepreneurship development in the country today.

     

    A situation often credited to financial intermediaries’ apathy to youth entrepreneurship and startups, which are usually perceived as being too risky, lacking relevant managerial skills and not possessing adequate collaterals acceptable for conventional credit,” he said.

    He said the CBN and the banking sector are collaborating on a national Shared Agent Network programme, designed to ramp up access to basic financial services, such as cash-in, cash-out, funds transfer, bill payments, airtime purchase and government disbursements to an estimated 50 million persons who are currently either under-banked or unbanked. This initiative in partnership with licensed mobile money operators and super agents, is expected to roll out about 500,000 Shared Agent Networks within two years through the use of mobile technology.

     

     

     

  • Stanbic IBTC: Lifting SMEs beyond funding

    Funding has remained a major challenge faced by Small and Medium Enterprises (SMEs). Lack of infrastructure, logistics and workforce are others faced by SMEs operators. To surmount these challenges, Stanbic IBTC Bank has intensified its capacity building schemes with SMEs to enhance their business ideas, customer engagement, funding, book keeping and tackling regulatory issues, writes COLLINS NWEZE.

    Capital is perhaps the most important factor driving the growth of Small and Medium Enterprises (SMEs), but not the only factor. In Nigeria where SMEs generate their own power, logistical structures and other key infrastructure, chances of failure remain high, unless SME operators are equipped with the right skills and support to navigate the challenges.

    The general view is that over 70 per cent of new businesses in Nigeria do not survive beyond the first five years of their establishment due to the numerous challenges they encounter.

    Apart from access to finance and operational challenges, enterprises also need to enhance capacity, which is one of the main impediments to growth. Many businesses struggle with book keeping, which means lenders or investors struggling to assess the business viability. Also, their inability to determine their target markets and execute the appropriate strategy means resources are dissipated without delivering the desired objectives.

    A major impediment to business growth in Nigeria, according to experts, is capacity building, contrary to mostly held view on financing by many business owners. Capacity building encompasses various aspects of business _ from business ideas, customer engagement, funding and book keeping to recruitment, logistics, sales and marketing to regulatory and environmental issues, among others.

    At the core of capacity building is the need to provide the needed tools for developing business sustainability. Executive Director, Personal and Business Banking, Stanbic IBTC Bank, Babatunde Macaulay, said businesses needed the “right support in terms of infrastructure, financing and capacity building” for sustainability.

    This explains why recent interventions by the government and private sector players to develop a strong and sustainable enterprise sector have largely been geared towards capacity building. Stanbic IBTC Bank, for instance, organises yearly nationwide enterprise workshops in several cities across the country.

    “The enterprise sector is pivotal to the economic growth and development of a nation. In recognition of this, we developed the seminar series to provide innovative marketing, financial and management skills that are useful to businesses and provide the skills needed for such businesses to grow,” Macaulay said.

    He explained that over 8,000 business owners have been trained at the yearly capacity building sessions and the figure is exclusive of those who have benefited from the bank’s strategic digital business training carried out in partnership with Google and others.

    Stanbic IBTC Bank believes that enterprises need strong hands to steady them as they take their first tottering steps. “In more advanced economies, governments undertake massive enterprise development and promotion through loan guarantee schemes and tax incentives. A key pillar of governments’ enterprise drive in such climes is the linking of enterprises with appropriate technologies and educational institutions. What this does for the businesses is to reduce the burden of sourcing human capital and technology, as well as enabling them to tap into a steady stream of vital research works that are relevant to their operations. The results of these interventions are often impressive, with enterprises becoming the engine of growth and transformations,” the bank said.

    Continuing, the bank said: “Businesses need cash. They equally need advisory services, business and networking opportunities, as well as human capital and marketing. The Small and Medium Enterprises Development Agency of Nigeria (SMEDAN), established in 2003 by the Federal Government, was set up as a co-ordinating agency for enterprises, helping to link ideas with finance while exposing businesses to opportunities. With a survey that shows Nigeria as home to 17 million enterprises, providing a structure for those businesses to thrive becomes a priority. The government realised quite early that it may not achieve much in developing a robust and thriving enterprise sector, which is why private entities are encouraged to pitch in.”

    Stanbic IBTC, in keeping with its tradition of promoting businesses, took up the challenge to help mold a robust, digitally savvy, and profitable enterprise sector. The Bank’s approach is very interesting. It has developed a unique value proposition to support businesses with transactional products, savings and investment solutions, lending products and wealth protection solutions. Underpinning all these is an investment in technology, designed to make banking easier for its enterprise clients. Apart from using best-in-class payment solutions, the bank had equally launched an internet banking offering specifically for enterprises.

    “To help clients improve operations,” Macaulay explained, “we believe a migration to digital banking will reduce the challenges faced by customers and help them run more efficient businesses. Instead of spending time travelling to visit our branches, we have created a platform called Enterprise Direct for customers to fulfill their banking transactions by telephone and email.”

    Highlighting some of the features and benefits of Biz Direct, Stanbic IBTC explained that it is branchless banking, with the ability to engage the bank from anywhere with a phone call or email. On the platform, customers can save cost via a zero current account maintenance fee to help optimise cost.

    The Biz Direct allows businesses in the country as well as from all over the world interact with the bank. The Biz Direct, which is a virtual centre where well-trained bankers interact with customers by telephone and email, is the first of its kind in Nigeria. According to Macaulay, “It is a testament to the bank’s focus on enterprises that it created a fully dedicated centre to handle enquiries, requests and all other banking needs of enterprises”.

    Equally important for enterprises is Stanbic IBTC’s second approach to capacity building through collaborations. The most recent is the collaboration with Google to train over 1,000 young entrepreneurs and enterprise operators in eight cities on digital skills in 2016. “By organising the capacity building sessions in different parts of the country, the partners hope to build critical mass of businesses through increased adoption of digital technology and enhance their contributions to economic development,’’ the bank said concerning the collaboration.

    According to Stanbic IBTC,  while launching the virtual business centre, “Enterprise Direct” will change how banks interact with their clients. The era of depending on physical branches to serve clients, the bank said, is disappearing, and technology will be the major driver of customer engagement in the future. “The future of banking is certainly interesting, and with innovative solutions like Enterprise Direct, the future of businesses in Nigeria is certainly assured,”the bank said.

     

    Views from SMEs customers

    The SME sector is pivotal to the economic growth and development of any nation and Nigeria is no exception. That explains why it is important that operators get the right support in terms of infrastructure, financing and capacity building.

    Stanbic IBTC Bank sees the symbiotic roles of the Small and Medium Scale Enterprises sector and financial institutions. To buttress this assertion, the bank, in an ongoing testimonial campaign, features some of the businesses it has partnered in terms of supporting them with banking solutions, advisory services and facilities across the country.  The campaign has not only shown the bank’s strong footprint in the SME sector, it has also helped to disapprove a generally held but erroneous notion that financial institutions hardly support enterprise to grow.

    The testimonial campaign started early last year, covering the North, West, and now the Eastern market. It features real and known businesses across the country, from the south, the north, the east that have benefitted from Stanbic IBTC Bank’s partnership and support.

    Mrs. Omoyemi Chukwurah of Seams and Stitches, who spoke on the impact of the bank’s support for her business, said the lender gave her wings to fly. Also, Jifatu General Enterprises Nigeria Limited Managing Director, Sabitu Yahaya, said out of all the banks he approached, only Stanbic IBTC Bank understood his need for business perpetuity and it was easy for him to make it his bank.

    On radio, owners of featured businesses were engaged in short interviews on their relationships with Stanbic IBTC Bank and their impression of the bank. They were all effusive in their commendation of the bank while highlighting some of the beneficial traits that endeared them to the bank.

    The lender is also not new to pushing the dial of service quality and delivery, customer relations and satisfaction. The Stanbic IBTC Group is a pacesetter in innovation across the entire spectrum of financial services from retail and corporate banking, pensions, assets management to trusteeship, insurance brokerage, stockbroking and custodian services. It continues to simplify its processes to ensure that customers are better served. Only recently, the bank expressed its willingness to digitise its entire operations when it launched the first self-service digital bank branch in the country.

    Stanbic IBTC Bank Chief Executive, Demola Sogunle said the bank had long embraced digitalisation to strengthen its operations and processes, make them more accessible, efficient and cost effective.

    The bank had also  sought collaborative efforts to help SMEs achieve capacity building. For instance, last year, it collaborated with Google to train over a thousand young entrepreneurs and SME operators in eight cities on digital skills. “By organising the capacity building sessions in different parts of the country, the partners hope to build critical mass of businesses through increased adoption of digital technology and enhance their contributions to economic development,’’ the bank had said of the collaboration,” he said.

    A sound knowledge of and robust approach to business management will, no doubt, ensure the survival of SMEs. Focusing only on finance may not augur well for the growth and development of small and medium enterprises. Stanbic IBTC Bank clearly understands this hence, the desire to promote businesses by providing financing, helping with capacity building as well as assisting their marketing drive as the testimonial campaign has shown.

  • Nigerian banks not structured to fund SMEs – Chamber

    Nigerian banks not structured to fund SMEs – Chamber

    Mr  Adetokunbo Kayode, President, Abuja Chamber of Commerce and Industry (ACCI), says the management of the funds for Small, Medium and Enterprises (SMEs) by banks in Nigeria is a weak link in the  financing of small businesses.

    He said this during his inauguration as the 10th President of the Chamber in Abuja on Tuesday.

    “We all appreciate government’s interest to support SMEs, especially on the issue of funding. But the management of the SME funds by the banks is a very huge issue, a weak link in the chain.

    “We all know our banks are not structured to fund SMEs. The organized private sector is therefore ready to help canvass and develop new concepts of alternate funding mechanism for SMEs. This will include finance leasing, peer certification for scrutiny of facility for SMEs,” he said.

    Kayode also called on the Federal Government to fully operate the National Economic Council and urged state governments to replicate same.

    According to him, that is the body that will help plan the economy, where critical policies are determined.

    He said this would bring the era of reactionary and ad hoc policies to an end.

    Read Also:‘We are growing SMEs  to drive Bayelsa’s economy’

    He advised that government at all levels should imbibe the ideal that governance was for the welfare of the people, and that to achieve that, there must be a national vision.

    He explained that vision 20:20:20 died the day it was launched because the government did not conceive, birth and own it.

    “A government must set up its own high ideals and with passion, chart a mission course to achieve that vision,” he said.

    The ACCI president called for an end to the emphasis by government agencies on revenue collection.

    “All these agencies have their core mandates; we want agencies in 2018 and beyond to concentrate on their core function which is to support enterprises to grow, rather than their unbridled demand for payment of revenues.

    “All these make doing business very harrowing and unprofitable. It is unacceptable for a people to pay for compliance with the law. Agencies ought to make it easier, cheaper, to obey the law, then make breaking the law very expensive,” he said.

    Kayode said the chamber would move from an amorphous organogram to a structured organisation. According to him, the chamber will set up a secretariat with four centres, including  business entrepreneurship, skills and technology centre and  the Abuja trade and convention centre.

    Mrs Iyalode Lawson, the National President, Nigerian Association of Chambers of Commerce, Industry, Mines and Agriculture (NACCIMA), also called for support from members to achieve its planned goals for the benefits of the association.

    Lawson advised the president to carry out his vision through public policy advocacy tools and in-depth knowledge.

    “The association believes that with the inauguration of the president, the chamber will achieve more remarkable increase in prestige, membership and finances.

    “I look forward to the establishment of new ventures while existing ones continue to thrive,” she said.

    Lawson said NACCIMA would support Abuja Chamber to advocate for policies and programmes that could benefit the private sector and encourage the growth and development of enterprises in Nigeria.

    NAN

  • ‘We are growing SMEs to drive Bayelsa’s economy’

    The Bayelsa Government will sustain its support to indigenous Small and Medium scale Enterprises (SMEs) to stimulate the state’s economy, create wealth and generate employment.

    The Commissioner for Information and Orientation, Mr Markson Daniel-Iworiso, gave the assurance after interacting with some beneficiaries of the state’s micro-credit scheme for SMEs.

    Daniel-Iworiso commended the Bayelsa Micro Finance and Enterprises Development Agency (BYMEDA) for ensuring that entrepreneurs took advantage of the opportunities offered by agency.

    He commended the Izon Ebe Micro Finance Bank for assisting in developing businesses in the state.

    He noted that the micro finance bank was playing a pivotal role in ensuring that investors in the state got facilities from commercial banks.

    Earlier, BYMEDA Director-General, Mr Ebiekure Eradiri, conducted the commissioner round the premises of some SMEs across the state.

    Eradiri informed the commissioner that SMEs in the state were enjoying funding and training support from the government.

    Some of the indigenous business concerns visited included Big Shoe Corporate EL and DE Integrated and Akpowaiwai Agro Resources.

    Others were King Koko Express, Pede Farms and Resort, and Izon Bakumo Enterprise, a welding company managed by Esther Bakumo.

  • FG to streamline SMEs intervention policies, says Osinbajo

    FG to streamline SMEs intervention policies, says Osinbajo

    Vice President Yemi Osinbajo on Saturday said that the Federal Government would streamline intervention policies for Small and Medium Enterprises (SMEs) to enable more people to benefit.
    Osinbajo gave the assurance at the Third Annual Tony Elumelu Foundation (TEF) Entrepreneurship Forum in Lagos.
    He said that the government would continue to embrace policies that would encourage start-ups to thrive.
    He commended the Founder of TEF, Mr Tony Elumelu, for the initiative, which he noted had been result-oriented.
    Speaking on “Tyranny of the Past or History”, Osinbajo called on Africans to stop remembering the past with apprehension.
    He said that dwelling on the past could cripple ones hope and vision.
    According to Osinbajo, African countries are nearly defeating hunger and famine with new farming tools, discovering cure for diseases and eradicating most causes of infant mortality.
    He called on the TEF participants to take advantage of the initiative for the growth and development of their countries instead of relying on the past.
    “The great days have come, everyone that has succeeded has his or her own failures,” Osinbajo said.
    Earlier, Alhaji Aliko Dangote, President, Dangote Group, identified infrastructure gap, corruption, policy inconsistency, low inter-trade rate and scarcity of finance as some challenges of entrepreneurship development in Africa.
    Dangote, however, said that a resilient investor would overcome the challenges.
    He said that SMEs should avoid waste, build strong teams and ensure cost efficiency to survive.
    Dangote said that Africa’s potential was enormous, hoping that the continent would experience a boom with enhanced agriculture.
    Zamfara State Gov. Abdul’aziz Abubakar Yari said that public and private sectors should work together for industries to survive.
    Yari urged that Africa should do away with corruption and policy inconsistency to advance.
    Kastina State Governor, Alhaji Aminu Bello Masari, said that African leaders must ensure formulation of policies with the private sector for the survival of the continent.
    Masari said that proper education was paramount for entrepreneurs to succeed, adding that basic education was important for the growth of any business.
    He urged access to loans by SMEs at lower interest rates.
    Oba Otudeko, Chairman, Honeywell Plc, said that government and private sectors’ cooperation was important for Africa’s development.
    Otudeko remarked that entrepreneurship was not easy, and urged entrepreneurs to conceive unique ideas to succeed.
    “Empires of the future are empires of the mind”, Otudeko said.
    He added that African leaders should implement policies that would improve logistics and intra-African communications. (NAN)

  • SMEs are too large for BoI only

    SMEs are too large for BoI only

    Association of Small Business owners Association of Nigeria, ASBON, President Femi Egbesola, speaks with Bukola Aroloye on the unrecovered loans and the not-so-smooth relationship between BoI and SME operators.

    he House Committee on public account alleged that the BoI has some unrecovered loans of about N11billion. Could you tell us the beneficiaries of such loans and what efforts you are making at recovering them?

    I think the Bank of Industry is under the CBN, and it has the way of retrieving funds. You remember, sometimes when money is in the public and CBN was getting it back, those that were with the money were published and they responded positively. Some had their loans restructured. Those that were bad, I mean totally bad, were taken over by AMCON; they were able to save the bank from collapsing. I feel that the Bank of Industry needs to go through some ways or probably follow that kind of policy or something similar. The other side to it is that in this part of the world, if you give out loan it should be monitored. Some of us keep clamouring that if a bank like the Bank of Industry, which is supposed to give us intervention fund to SMEs to involve the stakeholder like us, for example, and if you are one of the SMEs that need a loan and you are told that before you will get the loan you need a letter from an association, it means that the association is also part of the recovering team. An average Nigerian might see it as national cake and because we have not seen people in Nigeria go to jail cause of credit, we see it as nothing will happen and actually nothing is happening. Another angle to it is that our culture system is not helping. When you see people in the government stealing billions of naira, all we do at the end of the day is that ‘return the money back to government’, and nothing happen to them. It’s a very wrong way of bringing our younger generation up who will also believe that  everything can come cheap without paying for it. That is not good enough.

     What is the relationship between SME operators and BoI?

    The understanding between them is not smooth enough. If we change the method, we will get a changed result. We have not been carried along well enough. We are in a system where people pay because they are forced to pay.  It’s not supposed to be, but that’s what we have here. The reason why micro finance are surviving now is because they ask loan seekers to bring relatives and form a group among their staff. Each group will know the resident and area of business of each loanee; this makes everybody responsible for each other. By this, the money will come back.

     What advice do you have for government?

    My advice is that first of all they should go and get a blue print that will work for Nigeria and SME. Commercial banks are not expected to work the way BOI or any other development bank operates. And the only way they can have that is if they relate with every other stake holder. If you want to be with the market women, you have to go to the market to know the weaknesses, strengths and abilities of the market women. If you just sit in the office and your loan is out there, there will be failure on delivery. If we look for a blue print that is different from what we have now and peculiar to our environment and our culture, also have an office that will monitor by calling the clients frequently.

     Can’t the BoI and development bank be merged?

    If we have as many banks as we like, with whatever name, it’s better. I think in any environment that there is no competition, it will not bring out the best. Competition brings out their best; if we have competition between development banks they will buckle up. SME is too large for the Bank of Industry; we need many of these banks to boost the goals of the SMEs. If we have just one Bank of Industry there will be no progress.

  • Business with First Bank: A Promising Future for Nigeria SME

    Business with First Bank: A Promising Future for Nigeria SME

    When the National Bureau of Statistics released the revised figure of active small and medium scale business operators in Nigeria, it looked normal; about 37 million SMEs are active in the Nigeria market.

    We have become too conversant with statistics without digging deep into the outcomes, the implications and the futuristic forecasts. For instance in 2007 Nigeria had a population of about 10 million out of school children according to the United Nations Organization. It was just like a statistics but that figure doubled in 2017.

    There is wisdom in acting upon development statistics. Buried in those statistics are information that can inspire action, create growth and sustain development.

    37 million SMEs in Nigeria sounds like one good news, the challenges notwithstanding, it generally reflects the entrepreneurial spirit of Nigerians and the possible outcome if the right things are done.

    China is a good reference of modern development; about 40 years ago China was underdeveloped but visionary and determined to lead world economy. China’s strategy was investment in education and sponsoring a mass of micro cottage industries which engaged in diverse forms of production, about 30 million micro cottage, small and medium scale industries emerged with the goal to dominate the global market. It was not a perfect smooth; they made mistakes, had a bad reputation for fake production but with time, China perfected its acts through trial and error. Now, the world calls on China for technology or textile, China is destination for all forms of production.

    Nigeria too, can become that industrial hub at least in Africa. The opportunity abounds but the coordinated strategy seems to be lacking.

    Although financial institutions like First Bank leads in creating platforms to stimulate and advance the growth of small and medium scale businesses, government needs to create a clear vision and a more aggressive path.

    Creating that path was expounded by Chairman of First Bank Nigeria, Ibukun Awosika when she observed that “Path to a sustainable economy for Africa, particularly Nigeria, is feasible only if efforts are made and sustained to build as many Small and Medium Enterprises (SMEs) as possible because SMEs constitute the bulk of most African economies, and comprise business enterprises that employ fewer people. She said.

    “To build a sustainable business, you need to be clear on where you want to go and why you started,” Awosika said.

    The programs and products of First bank attest to the positioning of the bank to deliver unequal service to the small and medium scale business sector.

    For instance, the Economy and You, a program which highlights essential capacity development for startups was conceived to deliver information that will inspire and support the growth of SMEs in Nigeria.

    No doubt First bank story is unique; the bank is the biggest lender to SME sector in Nigeria, through partnerships with organized small scale industries association, the bank has a single digit lending rate for members, smashing the high interest rate phenomenon, the very first steel ceiling that inhibits inclusion of small businesses in the corporate lending circle. This is a major step to advancing the Nigerian SME to the next level.

  • Lagos set to release loans to 1,000 SMEs

    Lagos set to release loans to 1,000 SMEs

    Governor Akinwunmi Ambode led members of the State Executive Council and other top officials to Shibiri/Ekunpa Area Office in Oto-Awori Local Council Development Area (LCDA) for the second quarterly Town Hall meeting. There he spoke about what has been done and what to expect this quarter, including the release of loans to fresh 1,000 businesses, writes WALE AJETUNMOBI

    OTO Awori is a Lagos suburb. It is home to Alhaji Abimbola Suraju, a market leader. Suraju was shocked last Friday and he could not hide his excitement.
    “I want to sincerely thank Governor Akinwunmi Ambode for bringing this town hall meeting to Oto Awori. I never believed that in my lifetime that this place will host the Governor and his cabinet members. Before now they would always ask us to come to Ikeja, but this time around, they have come to our own community,” Suraju said.
    Suraju spoke when Governor Akinwunmi Ambode led members of the State Executive Council and other top officials to Shibiri/Ekunpa Area Office in Oto-Awori Local Council Development Area (LCDA), venue of the second quarterly Town Hall Meeting for the year and seventh in the series.
    At the meeting, he revealed the shape of what to expect this quarter, one of which is the fact that another 1,000 businesses will receive loans.
    Oto-Awori, one of the 37 LCDAs carved out from Ojo Local Government, has never hosted such delegation in recent years and the excitement on the thousands of residents that trooped to the venue to catch a glimpse of the Governor and listen to what he had in stock for them was enough to tell the story.
    During his opening remarks, Ambode said he was excited to be in the community to get first-hand information on the needs of the community and how his administration could respond accordingly.
    For him, Oto-Awori was part and parcel of his promise to run an all-inclusive government, thus no community would be left behind in the quest by his administration to ensure all round development of the State.
    “The train of our Quarterly Town Hall meeting has arrived in Ojo, the home of our dependable and reliable Deputy Governor – Dr. Mrs. Idiat Oluranti Adebule. I salute the good people of Ojo and the Lagos West Senatorial Zone. We are very happy to be here with you today,” the governor said.
    The governor took over one hour to allow residents cutting across community leaders, traditional rulers, market women, youth leaders and party leaders in the area to ask questions.
    On a request for a General Hospital, Ambode said three new facilities have been catered for in the 2017 budget.
    “Talking about General Hospitals, in the budget we have designated General Hospitals for three areas and Ojo Local Government is one of them. It is in the pipeline, it’s just a matter of time, we are already closing in on it,” he said.
    He also assured that efforts would be made to improve healthcare service delivery in the riverine area in Oto Awori, saying that residents in such areas have remained relevant in the government’s achievements over the years.
    “This area is traditionally and historically known to be a major supporter of government and then we must give them back for the support which they have always been known for,” he said.
    Ambode also acceded to the request of the residents for the rehabilitation of the access roads linking the area to the Alimosho General Hospital which they currently use pending the construction of a nearby General Hospital and at the meeting immediately directed the State Public Works Corporation to immediately fix the roads to improve accessibility to the facility.
    The governor also directed contractors handling the projects to immediately return to their various sites, warning that his administration would not hesitate to terminate such contracts.
    “If we are able to do a link bridge in 11 months, if we are able to do Ajah flyover in 13 months and Abule Egba flyover in 13 months and we are going to commission all of them next month, how can these roads be there forever? So, obviously we should use the same spirit of delivering service to do all the outstanding roads. The Ministry of Works must go back to these sites, I must know what is going on within the next few days,” the Governor said.
    He listed some of the projects to include Mile 10 Road, Mowo Road, Tedi Road, Ilaje Road, Goriola Oseni Road, Sabo Mosafejo Road and Imude Orisa Road where only 1.5km of the road was covered by the contractor.
    “These are contracts already awarded, it’s for our own contractors to go there and finish the job, so the responsibility is on us to make sure you deliver these roads within the shortest possible time and that’s what it should be,” he said.
    The governor also said he had approved that all the mini waterworks across the State, numbering about 41 should be functional within the next 12 weeks to ensure that residents have access to clean and portable water.
    On the plight of the physically challenged, Ambode also directed that the Civil Service Commission and the Local Government Civil Service Commission to put modalities in place to employ at least 250 physically challenged persons into the State Civil Service.
    He also ordered the Chairman of the State’s Sports Commission to offset all arrears of allowances owed the physically challenged athletes in the State next week.
    On his administration’s achievements in the last quarter, the governor said the Neighborhood Watch was rebranded and launched as the Lagos Neighbourhood Safety Corps and provided with equipment to combat illegal activities within the populace, explaining that the Corps will complement the efforts of the police in curbing crime and criminality in the state.
    Ambode added that within the quarter under review the Lagos State Employment Trust Fund continued to fulfill its mandate of providing subsidised loans to entrepreneurs, revealing that N1.7 billion was approved as loans to 1,400 businesses out of which N1.2 billion has already been disbursed to 800 people.
    “By the end of this month, loans to another 1,000 businesses will be approved, taking the total loans approved above 2,000. To further serve Lagos residents, the Fund will soon open the application process for skills development and training to help our unemployed youths take up existing jobs within the Lagos economy. I urge you to visit the Fund’s website or their liaison offices in the local governments to apply for their various programs,” he said.
    On agriculture, the governor said his administration has commenced the upgrade of the 167-hectare Songhai Model Farm in Avia-Igborosun, Badagry to encourage organic agriculture and train citizens interested in agro-business for local consumption or export, while 540 fishermen across the state were trained on the use of fishing equipment to improve their skills as well as optimize their understanding of the trade and boost income.
    On a request for the government to utilise the 300 hectares of arable lands in the area, the governor said he would visit the area with his team to access the land and look at the possibility of boosting the economy of the area through mechanised farming.
    Ambode said the government would kick start the implementation of the Cleaner Lagos Initiative, implement the construction of 181 roads across the 57 LGs/LCDAs, complete the Abule-Egba and Ajah flyover bridges, further signalisation of Lekki – Ajah express road and continuation of Road network upgrade in all the three senatorial zones.
    “Furthermore, initiatives for tourism will be intensified by commencing Development of Heritage Centre for Leadership (Presidential Lodge), Lagos History Centre, J.K Randle Centre, transformation of the Onikan Museum, Development of tourism hubs in Lagos-West, Lagos-East, construction of six cultural theatres in Alimosho, Badagry, Epe, Ikorodu, Ikeja and Lagos Mainland, and continuation of Epe and Badagry waterfront development as well as other tourist potential in the area,” he said.
    Ambode also said he was particularly excited that the 7th edition of the Town Hall meeting coincides with the 50th anniversary celebration of the creation of the state while he took time to appreciate the founding founders and his predecessors whom he said had worked assiduously in the last five decades for the growth and progress of Lagos State.
    “We appreciate the vision, tenacity of purpose and hard work which helped to shape our past and laid the foundation on which to build the prosperous future of our dear State,” he said.
    The people thanked the governor for the opportunity to engage with him. They will certainly look forward to seeing the promises coming to life in the next few months.