The Business Recovery and Insolvency Practitioners Association of Nigeria (BRIPAN) has urged the government to reduce lending rates to single-digit levels, warning that high borrowing costs are putting businesses at risk of failure. According to BRIPAN's President, Albert Folorunsho, the current interest rate environment remains too high for many businesses to sustainably service their debts, despite the recent reduction in the Central Bank of Nigeria's Monetary Policy Rate (MPR) to 23 per cent.
Folorunsho made the call at the closing of BRIPAN's 2026 Annual International Insolvency Conference, held in Lagos with the theme, "Building an Insolvency Architecture for a New World Order." He identified high borrowing costs as a major factor threatening business viability, particularly for enterprises that rely heavily on bank credit to finance working capital and expansion. This, he said, is a significant challenge for businesses that depend on borrowing to stay afloat.
The BRIPAN President noted that most businesses that fail depend heavily on borrowing, making it impossible for them to survive the repayment process without failing. He stressed that achieving single-digit borrowing rates remained an aspiration for businesses, and that BRIPAN would engage the Federal Government and other stakeholders on policies aimed at reducing financing costs. This, he believes, will help to strengthen mechanisms for rescuing distressed but potentially viable businesses.
The conference reviewed the effectiveness of business rescue mechanisms introduced by the Companies and Allied Matters Act (CAMA) 2020, particularly Company Voluntary Arrangements (CVA) and administration. Folorunsho said the provisions represented a shift from the traditional receivership approach, providing mechanisms through which distressed businesses could be rescued and continue operating as going concerns. The conference aimed to examine the challenges and implementation of these mechanisms.
One of the key recommendations from the conference was the need for a new code of ethics for insolvency practitioners, which BRIPAN has commissioned experts to develop. Folorunsho also stressed the need for stronger collaboration between BRIPAN, the Corporate Affairs Commission (CAC), regulators, and other stakeholders to improve the implementation of Nigeria's business rescue framework. This, he believes, will help to strengthen the country's insolvency architecture.
BRIPAN currently has more than 2,000 members comprising fellows and associates, and Folorunsho urged practitioners to intervene before businesses reach the point of collapse. He noted that the growth in membership would improve access to qualified practitioners, particularly for banks and other lenders requiring professional support in credit documentation and the structuring of lending facilities. This, he believes, will help to promote economic stability and business confidence.
At the association's induction ceremony, 33 fellows and over 200 members were inducted. Folorunsho urged the new associates to recognise the profession's role in promoting economic stability and business confidence, while calling on the newly inducted fellows to provide leadership and mentorship to younger practitioners. BRIPAN will continue to engage the government on policies aimed at improving the business environment and reducing business failures.
Key points
- BRIPAN urges government to reduce lending rates to single-digit levels
- High borrowing costs threaten business viability in Nigeria
- BRIPAN to engage government on policies aimed at reducing financing costs
