The Small and Medium Enterprises Development Agency of Nigeria (SMEDAN) and the African Development Bank (ADB) have begun fresh talks on provision of access to working capital for micro, small and medium enterprises (MSMEs) in Nigeria.
The discussion, which took place recently in Abuja between the Agency and a delegation from the continental development finance institution, which was on a country visit to Nigeria, centred on the creation of a special pool of fund in the African Development Bank specifically for MSME funding and promotion.
Speaking while introducing his team from the ADB, the Credit Bureau Manager for Africa, Dr. Muhammad Damak, disclosed that they were visiting selected Ministries, Department and Agencies (MDAs) of the Federal Government of Nigeria.
He added that their purpose of coming to SMEDAN was to evaluate the activities of SMEDAN towards the promotion of MSME development and also to ascertain the needs and challenges facing the MSMEs sector in general and SMEDAN in particular.
Damak said that they had met with the Central bank of Nigeria and some commercial banks in the country on the prospects of giving loans to small scale business operators.
Welcoming the delegation to his office, the Director-General of SMEDAN, Muhammad Nadada Umar, listed the challenges the Agency was facing in the discharge of its mandate, especially in the area of facilitation of access to business finance for MSMEs.
Some of these challenges include high interest rates and hidden charges as well as demand for collateral securities by commercial banks.
The Director-General informed the ADB team that the Agency, however, had recorded some level of success with its collaboration with the national Economic Reconstruction Fund (NERFUND) and the Bank of Industry (BOI).
He also noted that the Agency was working in liaison with NASENI to link entrepreneurs with the research and development (R&D) results to harness them for productive uses. He also revealed other efforts of the Agency, which include the collaboration with National Bureau of Statistics to collect data base for the country and the rating of MSMEs to make them marketable to national and international investors.
Also in his remark, the Director of Strategic Planning, Policy & Coordination (SMEDAN), Mr. Olawale Fasanya, said the Agency’s collaboration with NBS to collect MSME database had commenced with a pilot scheme already in Kano and Lagos.
He then called on ADB to support the Agency in building and financing cluster in some areas and making sure that monies meant for MSME development given to banks actually got to the operators.
Fasanya also recalled that SMEDAN initiated a collaboration with the ADB in 2007 through the then Country Representative in Nigeria, Dr. Sipho Moyo, but expressed regret that the relationship did not last due to the transfer of the Resident Representative from Nigeria. He expressed hope that the renewed interest of ADB in SMEDAN would yield fruitful result.