MSME need access to unlimited grants for growth - NASSI boss
There is the need for Micro-, Small- and Medium-Enterprises (MSME) to have access to unlimited grants for business growth and profitability.
This was stressed during a plenary session at the 2022 Maiden National Conference of MSMEs on Tuesday in Lagos, by the Chairperson, Nigeria Association of Small Scale Industrialists (NASSI), Lagos chapter, Mrs. Gertrude Akhimien.
Akhimien stated that in addition to the unlimited access to grants, MSMEs also require single digit interest loan to sustain their businesses.
“What we have here in Nigeria is that you start a business from your home and in a moment, someone orders for 10 of those products and the MSME is trapped looking for loans, thereby hindering business growth,” she said.
Head, SME Sales, Fidelity Bank, Mr Moshood Oyewole, said the bank had and would continue to provide programmes for all MSMEs to support their businesses.
Oyewole said that the challenge of MSMEs' accessing finance was the issue of not having collateral which Fidelity bank had been able to solve.
He said that they now have all their products designed to access loan without collateral while they also do insurance for the SME.
“Today, if I want to give a loan or a grant for one to do business, I need to see that he or she is actually doing the business, it is not enough to tell me look at my shop.
“It is enough for me to see an account, either in your name or you have registered the business and I can see what is going into the account within three or six months,” Oyewole said.
He said that some of the SMEs do not have record of their products, adding that grants are given to women than men because of their peculiarity and passion to manage many things at a time.
The adviser to the Board Chairman, Lagos State Employment Trust Fund (LSETF), Mr Hakeem Onasanya, said one of their objectives was to provide affordable access to finance.
According to Onasanya, LSETF gives loan of 9 per cent single digit interest rate, adding that they encourage more SMEs to access the loan without collateral.
He said that LSETF also gave situational grants to SMEs, MSMEs to support their businesses after experiencing external event which might have affected their goods.
Onasanya indicated that they gave grants to over 2,000 MSMEs and SMEs businesses, and also in COVID-19 pandemic, they also gave grant to 1,800 MSMEs and SMEs businesses.
He said that they also assisted businesses to access digital space and they had trained over 5,000 small business owners across the state.
Also speaking, the Director, Enterprise Development and Promotion, Dr Monday Ewans, of SMEDAN, said many of the MSMEs and SMEs usually seek for loans that they need money to remain in business.
Ewans said that after investigation, they discovered that many of the MSMEs and SMEs needed adequate skills which SMEDAN had been providing for them from time to time.
He pointed the need for the MSMEs and SMEs to make the best use of the opportunities of SMEDAN training, grant and enlightenment made available by the Federal Government through them to sustain in the business.
In his opening remarks, the Director General, Small and Medium Enterprises Development Agency (SMEDAN), Mr Olawale Fasanya, said the agency was working hard in ensuring MSMEs, both Nano and Micro have access to competitive markets.
He said that several factors were responsible for the MSME to have poor access to competitive market, saying this would be discussed during the conference.
Fasanya urged the several Government MDAs, established to provide critical support towards creating enabling environment for MSMEs to take up the challenge and creatively start thinking of how to solve the problem that borders on their mandates.
The agency had collaborated with GIZ to organise this National Conference. Essentially, the Conference was to provide the much-needed platform to proffer ways and means of making the 39 million MSMEs competitive in global market space.
He said that SMEDAN want to see how they could push the contributions of MSMEs to national export basket from the current 6 per cent to a minimum of 10 per cent within the next three years.
“The last National MSME Survey, jointly conducted by SMEDAN and the National Bureau of Statistics, put the total number of MSMEs in Nigeria at over 39 million.
“The sub-sector is therefore very critical at the global, national and sub-national levels, especially for socio-economic reasons. It is important to point out the fact that there was about 2 million MSMEs that closed shop between 2017 and 2021, largely due to the COVID-19 pandemic.
“Despite the challenges, the 39 million MSMEs account for 46.3 per cent of the GDP and 87.9 per cent of total employment in Nigeria. This is similar to the contributions of the sub-sector in other emerging economies such as India, and South-Africa.
“According to the 2021 World Bank report, MSMEs represent about 90 per cent of businesses and more than 50 per cent of employment worldwide. MSMEs contribute up to 40 per cent of national income (GDP) in evolving economies.
“In Nigeria and according to the 2021 MSME Survey report, MSMEs contribute only 6.21 per cent to the total export basket of Nigeria compared to 49.35 per cent in India FY2021 and 68 per cent of exports in China (FY 2020).
“This relatively low contribution of Nigeria’s MSMEs to exports are largely attributed to the poor competitive nature of the sub-sector,” Fasanya said.
The SMEDAN DG said they were working closely with the FATE Foundation to conduct a research that borders on MSMEs competitiveness.
He said that the Agency was also interested in connecting Nigerian MSMEs to the huge regional markets, adding that Nigeria participated in the the first ever Nigeria-Gambia regional Trade Fair which ended few weeks ago.
SMEDAN has also facilitated the establishment of a virtual platform to enable MSMEs participate in global markets through the Market Hub.
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