“We use this to improve access to credit and the technology that would be used will be a fintech technology. We have already set a target for ourselves that by 2020, the rate of financial inclusion must increase to 80 per cent from about 48 per cent a year and a half ago. So this is just part of our initiative to deepen financial inclusion in Nigeria.”He said the loans will be disbursed through the Bankers Committee’s AGMEIS scheme, being five per cent of profit after tax set aside by banks to support small and medium enterprises (SMEs) in agriculture or other small businesses badly in need of finance to scale and enhance their competitiveness and profitability.
“The existing microfinance banks are doing their best, and I’ve heard this is an attempt to crowd them out, but this is not true, but to complement their services, and see to it that whatever service is being provided by these microfinance banks should be seen to be fair to their customers.”
I also know some rural communities where microfinance banks charge very prohibitive interest rates, but here, we are talking about making fund available to these people. This will help to create some form of competitive landscape so that those kinds of practices will no longer arise. “We are just inspecting one out of the first seven, and we are scaling up to the next 50 in the next phase. We believe that before the end of this year, we would have moved substantially in making sure that they are set up and able to provide finance to small businesses.”