Baobab Upbeat about Nigerian Economy, Reaffirms Commitment to MSME Devt
Gilbert Ekugbe
Baobab Group has expressed optimism about the Nigerian economy despite the harsh business environment for invesments in the country.
Expressing its confidence on the nation’s economy, the Group Chief Executive Officer, Baobab Group, Mr. Philip Sigwart, at a press briefing said the company is earmarking over 60 per cent of its loan portfolio to Micro Small and Medium Enterprise (MSME) development in Nigeria.
According to him, MSMEs are vital to reflating the nation’s economy especially at a time when the country is experiencing high inflation rate.
“I am very optimistic about Nigeria and of course we know that there has been some challenges recently, especially regarding the economy and inflation and the exchange rate, but fundamentally, I am very optimistic about Nigeria. It is a great country and we believe development happens step by step and this is why we also continue to open new branches. We have 28 branches and we are opening three additional branches before the end of this year,” he said.
He stated that on an annual basis, the bank disburses about $1 billion micro loans on the African continent, adding that with operations in seven countries in Africa, Nigeria remains one of its flagship operations on the continent.
“So we are really by far one of the biggest players in this segment. We are extremely proud of the development of Baobab Nigeria and we think that we can achieve a lot more. The country is huge and a lot of entrepreneurs still require financial services. A lot of entrepreneurs would like to take loans to develop their business activities and we are here to serve these entrepreneurs. There is a very strong demand and we are one of the few players which really focuses on serving very small entrepreneurs,” he added.
The Baobab boss added that the total asset of the Group is about $750 million servicing over 500,000 customers in Africa.
“Every year, we disburse about $1 billion in micro loans on the African continent. Nigeria is the biggest and also the biggest country in terms of population on the African continent. So that is why we wanted to be here because of the huge potential of the country,” he said.
Also speaking, the Managing Director, Baobab Nigeria, Olanrewaju Kazeem, said the idea behind the expansion of the bank’s operations is to touch as many States as possible
“Already we have the Baobab app which is doing a lot of wonders in the market enabling customers to do transactions seamlessly without actually coming to the bank. We also partner with some agency bank networks to render services to those in remote areas and this is going to continue in the years ahead,” he said.
He pointed out that in terms of credit, the bank disburses over N5 billion monthly to over 5000 customers.
“So you can do the mathematics, that would give us the opportunity to reach about 60000 customers every year representing a N60 billion disbursement.
He however, stated that the SME space is very important adding that studies have shown that over 80 per cent of the population are employed by the SME sector.
“Unfortunately, study has shown that about 80 per cent of them die before they are up to five years and mostly because they are not getting funding. That is the space we try to cover to ensure that SMEs survive to create more employment,” he added.
