The Small and Medium Enterprises Development Agency of Nigeria (SMEDAN) has disclosed that it is partnering with relevant stakeholders to introduce a functional credit guarantee scheme that will enable entrepreneurs to access funds without collateral. Alhaji Mohammad Umar, the Director-General of SMEDAN, told newsmen in Abuja on Wednesday that the scheme, which might not be domiciled in SMEDAN, would ensure that Small and Medium Entrepreneurs (SMEs) accessed credit facilities without the usual difficult conditions.
â€œSMEDAN is discussing with stakeholders on the implementation of the scheme. It may start with the public sector support, and will then involve the private sector, which will eventually drive the scheme.
Without cheaper funds, the SMEs cannot grow. Many countries have their credit guarantee schemes which they use to support the growth of their small businesses,â€™â€™ he said.
Umar said some of the stakeholders listed for discussion on the scheme included the Central Bank of Nigeria CBN, Ministry of Commerce and Industry and the Nigerian Association of Commerce, Industry, Mines and Agriculture (NACCIMA). Others are the Manufacturers Association of Nigeria (MAN) and Nigerian Association of Small and Medium Scale Enterprises.
The Director-General said SMEDAN had already understudied some countries that were currently implementing the scheme, including the UK, U.S., Germany, Thailand and Tanzania â€œwith a view to coming out with Nigeriaâ€™s model, based on its peculiaritiesâ€.
He said the scheme would be similar to the agricultural guarantee scheme, which had been helping farmers to access cheaper funds to grow their businesses. Umar said the agency had also been training young entrepreneurs to be self-sufficient, rather than looking for paid employment, under its youth empowerment programme.
He declared: â€œWe want people to realise that they donâ€™t have to work with government to make it. They are better off with their own enterprises. That is why we are interested in the success of the credit guarantee scheme.
Umar explained that a number of proposals were sent to the Bank of Industry and the Agric Bank, but that they were unable to assist because they had their own contraints.
â€œSMEDAN trains entrepreneurs to build their capacity so that they can apply the skills in any type of business,â€ he added. The national policy on Micro, Small and Medium Enterprises (MSME) introduced in 2009 was aimed at employment generation, wealth creation and poverty reduction.