The Central Bank of Nigeria has said it is working on adjusting conditions for lending to micro, small and medium enterprises (MSMEs) in the country.
This followed calls by operators in the real sector, agencies and Nigerian lawmakers for a reduction in interest rates, particularly for MSMEs.
Lending rates in the country currently hover around 28 and 30 per cent, making the cost of finance high for companies, especially small businesses.
Rising from the Bankers Committee meeting last week, the CBN and chief executives of banks said they plan to de-risk SMEs so as to make it easier to lend to them.
Acting director, corporate communications of the CBN, Isaac Okoroafor, told journalists after the meeting in Lagos that there was a consensus to look into ways to bring down interest rate “as a complimentary measure to bring about prosperity, especially through the SME and agriculture.
“This would involve finding ways of de-risking SMEs, because people argue that SMEs are too risky to lend to and so the bankers committee is working in collaboration with the CBN to ensure that that segment of business is de-risked by way of risk sharing and trying to tweak some of the conditions even as the CBN works to ensure that the macroeconomic impediments to low interest rate are addressed over time”, he added.
The Senate recently met with the CBN on the need to ensure that lending rates is brought down so as to save the country’s economy.
The CBN, the regulatory authority, has continued to insist that it cannot reduce interest rate in the country which is currently at between 25 and 30 per cent, to avoid worsening the inflationary pressure on the economy.
The President of the Nigeria Employers Consultative Association (NECA), Mr Larry Ettah, had at the weekend also joined in the call for a lower interest rate, noting that one crucial step towards revitalising the economy was by bringing down interest rate.
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