President Bola Ahmed Tinubu has expressed satisfaction with the performance of the National Credit Guarantee Company (NCGC), a creation of his administration. The NCGC was established to move Nigeria towards a credit-based economy and provide a loan guarantee scheme for small businesses. Before its establishment, entrepreneurs faced significant hurdles in securing credit for their businesses. Tinubu made this statement in a post on his official X handle.
The NCGC was created to address the challenges faced by small businesses in accessing finance. According to Tinubu, the agency carries part of the lending risk with participating financial institutions, giving them greater confidence to lend to businesses and borrowers they might otherwise turn away. This initiative aims to help small businesses overcome the barriers that keep them from accessing finance. The President's administration is committed to widening opportunities for entrepreneurs who were initially not captured in the nation's formal credit system.
The NCGC has made significant progress since its inception. The company has issued ₦21.59 billion in guarantees to 67,512 borrowers across 25 states and the FCT. This has enabled participating lenders to extend ₦46.95 billion in loans, with every ₦1 in guarantees helping to unlock about ₦2.17 in credit. The NCGC works with 19 financial institutions, including 13 commercial banks, three microfinance banks, and three development finance institutions.
The NCGC's success story is reflected in its impact on borrowers. Out of the 67,512 borrowers, 11,374 are women, and 33.5 percent are first-time formal borrowers. For over 22,000 Nigerians, this is their first entry into the formal credit system, providing them with a credit record they can build. Each successful repayment strengthens their credit record, making it easier to secure future loans.
The NCGC's support has also had a significant impact on employment. The company estimates that the businesses it has supported account for 661,291 direct and indirect jobs. This is a significant contribution to the country's economic growth and development. The President's administration is committed to continuing to widen opportunities for entrepreneurs and creating a more inclusive credit system.
Tinubu's administration has been building institutions to make credit more accessible to Nigerians. Through CREDICORP, working Nigerians can access consumer credit, while students can finance their education through NELFUND. The Bank of Industry and Development Bank of Nigeria continue to lend to businesses, and the NCGC is playing a crucial role in addressing the challenges faced by small businesses in accessing finance.
The President's commitment to moving Nigeria towards a credit-based economy remains unwavering. His administration will continue to implement initiatives that promote economic growth and development. The NCGC's success is a testament to the effectiveness of the administration's policies, and efforts will continue to ensure that opportunities created by these reforms reach homes and businesses across Nigeria.
Key points
- The National Credit Guarantee Company has issued ₦21.59 billion in guarantees to 67,512 borrowers across 25 states and the FCT.
- The NCGC works with 19 financial institutions, including 13 commercial banks, three microfinance banks, and three development finance institutions.
- The businesses supported by the NCGC account for 661,291 direct and indirect jobs.
