NICA Advocates Business-friendly Loans For SMEs
The National Institute of Credit Administration has emphasized that offering loans with low interest rates and flexible repayment terms will enhance the profitability of Small and Medium-scale Enterprises (SMEs).
According to a statement released by the Chief Executive Officer of NICA, Prof. Chris Onalo, he said such business-friendly loan conditions would incentivize both aspiring and current entrepreneurs to seek financing for launching new ventures or scaling up existing ones.
In his words,
“It is difficult for businesses to break even with high-interest rate loans because the SMEs have other high operating costs, which will make repayment a challenge to them. To be better competitors and be empowered to expand their trades, businesses should have access to single-digit interest-rate loans with flexible repayment options. This is the ideal situation that will boost a business-friendly environment.”
He called for support that would enable businesses to thrive better in the country because they provide livelihood to a large proportion of the population. The National Bureau of Statistics labour data showed that a majority of Nigerians were self-employed.
“Majority of Nigerians are self-employed while a much smaller proportion holds wage jobs. In Q4 (2022) and Q1 (2023), 73.1 per cent and 75.4 per cent of employed Nigerians respectively worked in their own business or farming activity for their primary job,” NBS said in the report.
