Increase Funding To MSMEs – NDIC Urges Banks, MfBs

BY UBON EKANEM, CALABAR – The Nigeria Deposit Insurance Corporation (NDIC) is demanding increased funding to Micro Small and Medium Scale Enterprises (MSMEs) to stimulate and activate the country’s economy for sustainable growth.

According to the Corporation, financial institutions, especially microfinance banks (MfBs), cannot continue to pay lip service to funding portfolios that should promote and position the MSMEs sub-sector as the engine of domestic economic growth.

It further said emerging trends in domestic and global economy are quite disturbing and have therefore made it imperative to adopt urgent measures at energising MSMEs’ activities for sustainable economic growth and development in any country.

NDIC’s Director, Special Insured Institutions Department, Mr Joshua Etopidiok, in canvassing the position of improved financing, said such support to MSMEs could be executed on the platform of moveable collaterals.

He explained that moveable collaterals are created to expand the credit space for individuals and MSMEs.

Etopidiok said the Corporation is deeply worried that about 36.8 per cent of Nigeria’s adult population are financially excluded and lacked access to savings and loans that could generally improve their living standards.

Speaking at a sensitisation workshop on: ‘Dead Capital/Moveable Collaterals and MSMEs funding’ organised by NDIC for MfBs in Uyo, Akwa Ibom State, Etopidiok said: “There is urgent need to encourage banks, especially MfBs to fund MSMEs through the shoulders of moveable collaterals.

“About 36.8 per cent of the adult population in Nigeria are financially excluded and lacked access to savings and loans and moveable collaterals are created to expand the credit space for individuals and MSMEs”

He warned that poor funding and lethargy towards MSMEs can no longer be an option given the nation’s dire economic situation of rising unemployment, reduction in foreign reserves, and lull in general economic activities.