The National Institute of Credit Administration (NICA) has urged the federal government to implement a robust credit guarantee system to support struggling businesses nationwide, aiming to breathe new life into the Nigerian economy.
This proposed initiative aims to usher in a transformative economic paradigm characterized by heightened productivity and the accelerated growth of cottage industries, informal sectors, and small to medium enterprises (SMEs).
In a statement issued by Prof. Chris Onalo, CEO of NICA, the rationale behind this initiative was underscored, emphasizing its potential to redefine Nigeria’s economic landscape and significantly augment production capacities. According to the statement, a national credit guarantee system would not only facilitate easier access to credit for individuals and businesses but also ensure that this access is underpinned by integrity and the availability of pertinent personal and corporate credit information.
Onalo articulated, “The envisioned economic shift should emphasize credit-driven business operations, fostering buying and consumption based on credit. With enhanced credit availability, production capacities will surge, as producers gain access to funds to scale up their operations through a robust guarantee arrangement acting as a facilitator.”
He further stressed the importance of maintaining a sterling track record characterized by integrity and honesty, citing these attributes as pivotal in determining creditworthiness under the proposed system.
NICA previously highlighted the urgent need for robust legislative measures to instill discipline, decency, and honesty within Nigeria’s credit ecosystem.
In alignment with efforts to stimulate economic growth and improve citizens’ welfare, the federal government has allocated an N100 billion Consumer Credit Fund in the 2024 national budget. Additionally, a Technical Working Group has been established through the Presidential Council on Industrial Revitalization, comprising representatives from key agencies such as the Central Bank of Nigeria (CBN), the National Identity Management Commission (NIMC), and the Federal Competition and Consumer Commission (FCCPC).
This group is tasked with devising a comprehensive framework to bolster consumer credit facilities across the nation.
