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SMEs closing down for lack of finance – LCCI

By on November 27, 2014

The President of the Lagos Chamber of Commerce and Industry, Remi Bello, has observed that the growth of the Small and Medium Enterprises in Nigeria remains stunted due to lack of access to finance.

Bello, whose observation was contained in an address delivered on his behalf by the Vice President, LCCI, Mr. Soboma Ajumogobia, during a seminar and luncheon organised by the group in Lagos on Tuesday noted that SMEs were critical in the transformation of the economies of countries worldwide.

He said, “SMEs are catalysts for economic growth and have a crucial role to play in the development process of the economy. Despite their vital role in the economy, they are constantly faced with a myriad of problems which inhibit their growth and performance. Many SMEs remain stagnant, uncompetitive and do not reach their full potential because of these problems, the most significant of which is lack of access to finance.”

Bello urged speedy action in the registration of movable assets of loan seekers in Nigeria so as to improve access to the N220b fund recently established for the Micro, Small and Medium Enterprises by the Central Bank of Nigeria. He also advocated a business environment devoid of regulatory hitches to SME lending.

Making reference to the recent CBN data, Bello noted that domestic credit to the private sector in Nigeria scored lowest in comparison to that of Brazil, Russia, India, China, South Africa, Malaysia and Indonesia. He said that in Nigeria, total bank credit extended to the private sector as of August, 2014 was equivalent to N17.38trn which was only 21.6 percent of the Gross Domestic Product.

 

[Punch]