The Central Bank of Nigeria has said that the financing gap for Micro, Small and Medium Enterprises (MSMEs) in Nigeria is estimated to be over N617.3 billion each year.
This was disclosed by the CBN governor, Mr. Godwin Emefiele.
He spoke in a chat with finance journalists, at the 30th Anniversary Conference and Awards, of Finance Correspondents Association of Nigeria, with theme: “Financing Infrastructure & SMEs for Inclusive Growth in the Post-COVID-19 Economy.”
He said five per cent of these enterprises had access to sufficient financing to cover their working capital and expansion demands.
He also noted that other barriers to MSME development in Nigeria, according to a PwC report, include access to markets, infrastructure deficits, insufficient financial flows, multiple taxation, regulatory burdens, and sub-optimal execution of MSME policy provisions.
Emefiele who was represented by the CBN Director Corporate Communications, Mr. Osita Nwanisobi, said access to capital is still one of the most significant barriers to MSME development in both developed and developing nations.
Despite being a significant driver of growth, innovation, and job creation, the governor noted that the ability of micro, small, and medium companies (MSMEs) to boost growth and generate jobs has been impeded by a lack of access to quality infrastructure.
He noted, “Beyond infrastructure, access to finance remains one of the biggest threats to MSME development in both developed and developing economies alike, with serious implications for productivity, economic development, and job creation.”
The CBN governor stated that the apex bank has implemented several policy measures to boost economic growth and mitigate the impact of the COVID-19 pandemic on Nigerians, while also noting that the CBN has remained committed to fulfilling its developmental mandate by collaborating with stakeholders in the infrastructure and MSME sectors to boost domestic output.
He emphasided the importance of fiscal authorities working with the central bank to improve the way they look at MSMEs and infrastructure development by implementing new policy measures to harness these businesses’ potential to foster innovation and industrialisation.
The CBN in the past had made many efforts to boost access to credit for Micro, Small and Medium Enterprises (MSMEs).
Last month, the apex bank developed guidelines for the regulation and supervision of credit guarantee companies in Nigeria.
The guideline would serve as a regulatory foundation for credit guarantee firms seeking to minimize credit risk, promote lower interest rates on loans, and complement other regulatory measures targeted at promoting MSMEs.