BENIN – The Central of Bank of Nigeria’s (CBN) monetary policy of high interest rates to commercial banks has been listed as part of reasons Small and Medium Enterprises (SMEs) are not growing.
Emmanuel Usoh, Edo State Commissioner for Wealth Creation, Cooperatives and Employment, made this remark at the 17th Micro, Small and Medium Enterprises (MSMEs) international summit and exhibition organised by the Nigerian Association of Small and Medium Enterprises (NASME) in Benin-City.
He noted that the apex bank’s monetary policy still pegs interest rates to commercial banks at between 20 and 25 per cent, which he said had made it difficult for SMEs to have access to loan from the commercial banks.
He also upheld that the commercial banks interest rates were laced with cumbersome collateral facilities, which had not helped the growth of small businesses in the country.
“The monetary policy of CBN is not cascading down to commercial banks where interest rates still ranging between 20 per cent and 25 per cent for commercial banks,” he said.
In his remark, Adebayo Somefun, the Managing Director of Nigeria Social Insurance Trust Fund (NSITF), who was represented by Stephen Bathana, the General Manager noted that SMEs was a key driving force in the nation’s economy.
Usoh listed other challenges inhibiting the growth of SMEs in the country to include corruption, huge infrastructure deficits, lack of capacity building for small business owner, institutional and public reforms.
Source: Daily Independent