House of Reps Harps on Support for BoI, Banking Reforms to Facilitate Financing

Nume Ekeghe

The House of Representatives Committee on Industry has advocated for policy reforms and increased budget allocations to facilitate financial support across critical sectors, with a particular focus on industrial and energy sectors.

Highlighting the significant role of the Bank of Industry (BoI), the Committee underscored its importance in driving economic expansion through the provision of single-digit interest loans.

In a statement, the BoI noted that the loans were particularly vital for small and medium-sized enterprises (SMEs) that often struggle under the weight of high-interest rates imposed by commercial banks, which can reach as high as 20 to 30 percent.

Speaking during a visit to the BoI’s office in Lagos and a tour of some key projects funded by the bank, the Chairman of the Committee, Enitan Dolapo-Badru, emphasised the importance of supporting banking institutions like BoI, which offer single-digit interest rates, as crucial for the survival and competitiveness of domestic industries.

According to him, industries are suffocating under high interest rates, noting that without remedial action, sectors crucial for the economic backbone like manufacturing will continue to decline.

Dolapo-Badru, highlighted the demise of once-thriving companies such as Dunlop and Michelin, underscoring the dire need for financial structures that can truly support the industry.

He noted that the advantageous rates offered by the BoI not only sustain businesses but also mitigate the cost pressures transferred to consumers, setting BoI apart from other financial institutions.

However, he articulated a need for legislative support for the enhancement of the legal framework governing BoI to amplify its performance and extend its reach.

Also speaking, the Chairman of the House of Representatives Committee on National Planning, Budget, and Economic Development, Ibrahim Isiaka, voiced his concerns about the energy sector, particularly the inefficiencies of Distribution Companies (Discos).

Isiaka advocated mandatory recapitalisation of Discos to address their funding shortages, which severely limit their capacity to distribute generated electricity effectively.

He said national development was stifled by an unstable energy supply, noting that without rectification, the economy stands on the fragile ground while suggesting a strategic intervention by BOI to stabilise the sector.

A member of the House of Representatives for Chibok/Damboa/Gwoza Federal Constituency, Borno State, Ahmed Jaha, appealed for more focused investment in peace-stable areas to prevent the escalation of unrest and promote regional development.

Jaha, said the northeast was a keystone for national peace, adding that securing and revitalising the region was imperative for the broader security and prosperity of Nigeria.

Another member of the Committee, representing Ihiala Federal Constituency, Anambra State, Dr. Paschal Abodike, highlighted the innate entrepreneurial spirit of his constituents, who are hindered by a lack of accessible financing.

He stressed the importance of supporting local manufacturers like Innoson Motors, which contributes significantly to the national Gross Domestic Product (GDP).

In response, the Executive Director of Micro, Small and Medium Enterprises at the BoI, Omar Shekarau, detailed ongoing efforts to address these concerns while calling for legislative support for more funding to help finance projects and businesses.

He said BoI had expanded its reach in the northeastern states, by setting up more accessible offices and offering tailored financial products designed to foster SMEs.

Shekarau explained that the BoI’s commitment extends beyond simple financial support as it was about creating ecosystems where industries and regions can self-sustain and prosper.

He announced BoI’s plan to invest more funds into programs specified for rural areas as well as commencing special projects for women, SMEs and youths, while also relaunching two of its programs targeted at small businesses and young entrepreneurs.

Shekarau said the convergence of legislative effort and financial strategy could herald a new era of sustained growth and stability in Nigeria’s most vulnerable regions and sectors.