The National Credit Guarantee Company (NCGC), a Federal Government agency in Nigeria, has unlocked N46.95 billion in loans for 67,512 Nigerians and businesses within its first year of operations. This achievement is a significant milestone in the agency's mission to provide partial credit guarantees to reduce lending risks and improve access to finance for small businesses and underserved consumers.
According to President Bola Ahmed Tinubu, the financing was mobilised through N21.59 billion in credit guarantees, translating to about N2.17 in lending for every N1 of guarantee provided. The President made this known in a message posted on his verified X handle, @officialABAT. He also stated that more than 22,000 Nigerians were brought into the formal credit system for the first time through the scheme.
The NCGC's first-year performance showed that N21.59 billion in risk cover unlocked N46.95 billion in financing for 67,512 borrowers across 25 states and the Federal Capital Territory (FCT). The beneficiaries include 11,374 women, while 33.5 per cent are first-time formal borrowers. This achievement demonstrates the administration's determination to move Nigeria towards a credit-based economy.
The loans will allow the new borrowers to establish credit histories, which could improve their prospects of securing further financing as they successfully repay their loans. President Tinubu stated that his administration has been building institutions around deliberate schemes, and its ongoing reforms are cruising to the opportunities stage. He listed the Nigerian Consumer Credit Corporation (CREDICORP), the Nigerian Education Loan Fund (NELFUND), the Bank of Industry (BOI), Development Bank of Nigeria (DBN), and NCGC as components of his administration's credit architecture.
The NCGC operates by providing partial credit guarantees, sharing part of lenders' exposure, and consequently reducing the risk attached to lending to underserved businesses and consumers. The company guarantees typically cover up to 60 per cent of outstanding loan principal, although higher coverage may apply to some strategic categories. The NCGC currently works with 19 participating financial institutions comprising 13 commercial banks, three microfinance banks, and three development finance institutions.
Beyond the volume of loans already mobilised, the businesses supported under the guarantee arrangement were estimated to account for 661,291 direct and indirect jobs. President Tinubu pointed out that access to credit was important not merely because of the amount of money disbursed but because of its capacity to expand businesses, stimulate consumption, and create employment. He added that his administration considered the expansion of credit as a critical bridge between its economic reforms and opportunities available to ordinary Nigerians.
The NCGC was created following a presidential mandate in August 2024 to address financing constraints confronting small businesses and underserved consumers. President Tinubu pledged that his administration would continue expanding access to formal credit across the country. He stated that they would keep widening the road until the opportunities their reforms create reach homes and businesses in every part of Nigeria.
Key points
- The National Credit Guarantee Company has unlocked N46.95 billion in loans for 67,512 Nigerians and businesses within its first year of operations.
- The scheme has brought more than 22,000 Nigerians into the formal credit system for the first time.
- The businesses supported under the guarantee arrangement were estimated to account for 661,291 direct and indirect jobs.
