The Managing Director of Bullion Go-Neat Global Ltd, Mr Olufemi Ajadi has urged Nigerian banks to create more Small & Medium Enterprises (SMEs) loans facilities in support of Nigerian entrepreneurs.
Ajadi said the move would not only help the capacity of Nigerian run companies but calso help boost the economy.
Ajadi who spoke at a forum of the Commerce & Industry Correspondents Association of Nigeria (CICAN) held in Lagos said funding support remained critical for survival of SMEs but that the government and it’s agencies had not seemed to appreciate that.
Ajadi said the current situation whereby emergent small firms are allowed to suffer due to the lack of finance was not auguring well for the economy.
He said not only was it worsening unemployment situation but it was contributing to the spiraling prices of goods and services.
He said because companies are forced to source capital from mainstream banks, at usually high interest rates, they could sell at low prices.
He referred to the tag of small & Medium Enterprises SMEs as the engine of growth, saying they could only perform such roles when they are supported by government at the teething stage.
Ajadi said with experience, that the government was worsening things for these firms by slamming them with huge taxes.
” I believe that the government can actually help SMEs in Nigeria, after all, these SMEs are helping the economy.
” SMEs help to create jobs, provide goods and services and should be supported by the government”
He cited examples with other countries saying that many of them were ahead of Nigeria because they had taken time to support their SMEs.
He is of the opinion that registration procedures could be simplified for Nigerian firms just coming up rather than the current situation whereby they are slammed with multiple taxes.
While acknowledging that some banks were trying by providing loans for firms, he said the conditionalities could be made easier.
“If you say that some banks provide loans, how many companies have accessed such loans and what are the terms?
“I still believe that if government could show interest in supporting Nigerian firms, they will give Nigerian banks strong mandates on it.
“Any bank which does not follow such a directive could be sanctioned.
“If Nigerian SMEs are supported effectively through the provision of small loans” they expand their capacity, create more jobs and help in fighting hunger and insecurity”, he stated