CBN decries low response to credit for SMEs in A/Ibom

By Isaac Job, Uyo

The Central Bank of Nigeria (CBN) has decried the poor response to credit facilities for Small and Medium Enterprises (SMes) by commercial banks, describing it as the bane of economic instability in Akwa Ibom state.

Addressing young entrepreneurs in Uyo on Thursday to mark the International Day of NSME with the theme: “Big money for small: Funding the SDGs,” the Comptroller General of the Central Bank in Akwa Ibom state, Mercy Paul said the intervention credit scheme for small enterprises in state has remained unutilized.

Paul, who was represented by Imakop Orok said credit intervention funds available for small scale enterprises, especially in agriculture and other agro -allied businesses have not been accessed by the entrepreneurs.

She disabused the minds of young entrepreneurs who assume that the loan process with the Central Bank begins with a business proposal, confirming that only the apex bank has the option of knowing whether the business plan is capable to service the principal and interest of any loan before approval, and not on the merits of the proposal.

She listed loan packages available for entrepreneurs to include, agriculture sector, cooperative societies and even for disable persons, regretting that very few people show up for the loan in Akwa Ibom state while majority are left out because of their inability to pay the five per cent counterpart fund needed as a condition for the loan.

“Only few people show up for this facility in Akwa Ibom state due to their inability to pay the counterpart fund of five per cent. This has affected smooth running of small scale businesses in the state,” she added.

However, she appealed to entrepreneurs in the agricultural sector to indicate interest in the loan to boost their businesses and generate more employment opportunities for the teeming population.

Paul warned the few beneficiaries of the credit facility not to divert the funds for other frivolities as the Economic and Financial Crimes Commission (EFCC) would hunt for them to recover the funds.

In his address, the Director General SMEDAN, Dikko Radda acknowledged that small scale businesses are the backbone of every economy across the world as it contributes to over 70 per cent of employment worldwide and stimulates economic growth.

“The MSME’s are the backbone of every economy across the world, accounting for more than 90 per cent of businesses and 60- 70 per cent of employment globally. Micro, medium and small enterprises play a pivotal role in stimulating economic growth, supporting inclusive growth and creating decent jobs to improve livelihoods of Nigerians.

Responding, the Chairman of Ikono Local Government Area, Itoro Columba observed that majority of Nigerians live in the rural areas and charged government at all levels to empower small scale business owners at the grassroots to improve their local economy.

He commended Governor Udom Emmanuel for providing counterpart funds for World Bank intervention projects in the state.