By Amaka Agwuegbo
Up until 6th August 2009, there existed two parallel associations in the microfinance sector â€“ the National Association of Microfinance Banks of Nigeria (NAMFBIN) and Association of Microfinance Bank in Nigeria (AMBN) â€“ which was characterized by misunderstanding and misconception.
But the November 12, 2009 Extra Ordinary General Meeting and harmonisation exercise, which was witnessed by officials of the Central Bank of Nigeria, CBN, birthed the much awaited National Association of Microfinance Banks, NAMB.
Thus, April 8, 2010 saw the dissolution of the Transition Committee which was mandated to midwife the Inaugural General Meeting, IGM, and the election of executives to oversee the affairs of the microfinance association.
Speaking at the IGM, Director, Other Financial Institutions Department, OFID, Mr. Femi Fabamwo, said a lot has to be done as NAMB is expected to bring microfinancing as an integral part of nation building.
He also urged the executives and members to serve as a galvanizing body for information and skill sharing, be an agent of dispute resolution and expose Nigerian microfinancing to the world.
â€œI want to stress that the CBN doesnâ€™t have any candidate, but our position is to ensure that only credible people are elected.
â€œAs transparency and accountability are key to sectorial and nation building, it is necessary that the association is not left to people who donâ€™t have the drive, vision, clout and capacity to lead it to its desired destination.
â€œThe association should not lose sight of the fact that it should have a reflection of the federal character so as to give it a national outlook.
â€œThe executives are to ensure that the institutions are well run because it would be a shame that, after electing officers to man the affairs of the association, their licenses would be revoked after 2 months.â€
Fabamwo said that one of the key areas of debate among the regulatory authorities was if chairmen of MFBs are to be allowed to be part of the association, or just to restrict it to MDs/CEOs.
â€œBut we came to the conclusion that they all have different roles to play. Of the elective positions, two key positions should be reserved exclusively for MDs/CEOs as this would ensure that when the association is growing, and the chairmen are leaving the scene, the MDs/CEOs can move up and take over.â€
Pointing out that the present state of the microfinance sector is of great concern to the CBN, the OFID Director said that this necessitated the commencement of target examinations of MFBs to ascertain the financial status of MFBs.
â€œThe target examination, which we started in Lagos State, has begun in other states and this would help us in determining the state of these banks. When it is done, actions would be taken to ensure that banks are doing what they are licensed to do.â€
He also warned MFB operators to desist from opening branches with authorization from the CBN, while those who have continued to clear third party cheques and dividend warrants are to stop as they are bearing a huge risk.
On the issue of giving false or falsified account statement to customers seeking to obtain visas, Fabamwo warned that any bank caught doing so would be sanctioned.
Speaking on the certification programme, the OFID Director said the aim is to build a critical mass of knowledgeable people who would reposition the microfinance sector. He urged those who have not nominated two members to participate in the programme to do so.
â€œThe programme, which would be in two diets, would run for three weeks and the CBN would bear 60 per cent of the cost while the various banks would take care of the remaining 40 per cent. This is to ensure sustainability of the programme.â€
Also speaking at the IGM, the chairman of the Transition Committee, Mr. Mathias Omeh, thanked the CBN for its support and encouragement during the harmonization exercise.
â€œI refer to them as the rock of ages of NAMB, as NAMB is actually their baby. As NAMB learns to crawl and grow, I appeal to the CBN to sustain their mentoring role of encouraging, guiding and supporting it.
â€œI wish to also commend my colleagues in the Transition Committee for their commitment and invaluable sacrifices of their time and resources including the frequent travel risks they undertook in pursuit of our mandate.
â€œTo you our teeming members, we greatly commend your wonderful support and constructive contributions toward the success of our mandate. I solicit your continued support for the incoming Executive Council.â€
Omeh urged members to remain committed to the noble tenets of global best practices and accountable corporate governance in the discharge of your microfinance banking services to our focal customers who constitute the grassroots and 75 per cent of the Nigerian population.
Pointing out that the raison dâ€™etre for the association and the central challenge is the mainstreaming of microfinance banking into the hub of the nationâ€™s financial system, Omeh noted that there is still much in Nigeriaâ€™s political economy that is harsh and hostile to doing business.
â€œPoor infrastructure, particularly inadequate power supply and deplorable state of the roads, policies and legislation that destabilize business all make the cost of doing business abnormal and ultimately discourage investment and enterprise.â€
Listing the criteria for voting and to be voted for, the chairman of the Electoral Committee, Mr. Victor Itoyon, said: no geo-political zone will have more than one position out of the five to be vied for; the candidate must have a minimum of HND, BSc, or its equivalent; candidates must ensure to make available to the Panel, all necessary requirements not later than two months from day of election; only chairmen on licensed MFBs can be voted for.
Others are: to ensure that the MDs or chairmen of the voted banks have submitted three out of the last 6 rendition of returns; must provide evidence of payment for NDIC premium for the financial year; must be a Nigerian, or, if not, must have a resident permit and have been doing business for the past 7 years; and paid subscription and conference fees.
The elected executives
â€” Mr. Mathias Omeh, National President
Mr. Mathias Omeh is the Chairman, Nsukka MFB and the chairman of the recently dissolved Transitional Committee that was set up to ensure hitch free elections.
Prior to his emerging as the national president, Omeh was the 2nd vice president of NAMFIB, he then rose to become the 1st VP. Omeh was a member of the harmonization committee that knocked in the constitution, then later the chairman of the Transition Committee.
Attributing his victory to his exposure, he praised his opponent, Chief Olutayo Adenekan for the good fight he put up.
â€œAll these posts I held contributed to my success as I have been garnering exposure in the course of discharging my duties.
â€œThe agenda of the newly elected officers is contained in the microfinance constitution, and we know that the sector has a problem of awareness as majority of the public are in the dark concerning the roles MFBs. Thus, they tend to utter unguarded statements.
â€œSome people may come to an MFB for a loan of N5m, and when you refuse them such loans, they go about saying that such a bank has no money, while they are unaware that the policy stipulates that an MFB cant grant a loan exceeding N500,000.
â€œAlso, when the CBN gives guidelines on interest rates, the beneficiaries of loans and advances from MFBs will expect the banks to adhere to the CBN rate, forgetting that the roles we play as MFBs are beyond giving loans. We track our loans, train the beneficiaries, create market for them and go them individually to collect the money.â€
Omeh noted that since the two bodies just merged, it is the responsibility of the executives and members of NAMB to ensure that no side feels sidelined.
â€œSo, our first major job is to ensure that we create and maintain harmony between both former associations so that members will feel free and be listened to.â€
â€” Mr. Jude Nosagie, 2nd Vice President
Mr. Nosagie is the Managing Director of Prosperity MFB, Edo State. Before his emergence as the 2nd VP, Nosagie was a member of the just dissolved Transition Committee.
On how the association would move the microfinance sector forward, Nosagie said â€œWe would bring to fore the reason why there is a microfinance policy in Nigeria and this means that we would embark on massive sensitization activities in making the 75 per cent of the â€˜active poorâ€™ know the benefits of banking with MFBs.
â€œWe would try and separate the real from fake MFBs because a lot of corporative societies are giving people the impression that they are MFBs, while they are not. We would also go to the people and make them know that we are there for them.
â€” Mrs. Bunmi Lawson, Treasurer
Mrs. Lawson is the Managing Director of Lagos-based Accion MFB, and was voted in as the Treasurer of NAMB over Alhaji M. C. Hassan, Managing Director, Nigerian Police Force MFB.
Commenting on the conduct of the elections, Lawson said it was free, fair and should serve as an example to Nigerians on how elections should be conducted as members were nominated and voted in without rancour.
She also said the Omeh-led association is poised to tackle the key twin problems of lack of adequate human and financial resources. â€œI am very honoured to be part of this election and be voted in as the Treasurer. The elections for the 5 positions were done in a day and the results were not contested by members.
â€œOne of the issues the elected officers would tackle is the issue of lack of adequate human and financial resources, which are hindering the growth of the sector.
â€œIn the area of human resources, we could source for foreign partners who would come and train our members so as to build up the dwindling capacity in the sector.
â€œIn the financial resources, we would ensure that our depositorsâ€™ fund is properly invested and safeguarded so as to prevent it from being frivolously spent. We would ensure that we get adequate funding to keep the wheels of the sector oiled.â€
Lawson noted that aside these, the association should be able carry out its duties which include advocacy, holding members accountable by making sure that they provide the services that they ought to do. She also said in its bid to boost public confidence in the MFB sector, the association would hold a lot of public fora where customers and operators can meet rub minds. The fact that we have a duly elected body means that we have credible and competent professionals on our board.
Other executive members are Hon. Jethro M. Ahun, chairman, Eagle MFB, who emerged as the 1st Vice president; and Alhaji Abdulkadir Mohammed, who was voted in as the Legal Adviser.
Commenting on the results of the elections, Managing Director of Lagos-based RIC MFB, Mr. Omololu Fatunbi, said the elections were free and fair, though some members were not allowed to make known their observations which could have helped better the elections.
â€œThe elections were free and fair, but some members were not given the opportunity to voice their opinions and observations which could have impacted on peopleâ€™s opinions. The CBN did a very good job, and if not for the presence of OFID Director, the elections would not have been contained. But this is a lesson to some of my colleagues.â€
In his remarks, the MD of Okuku MFB, Osun State, Mr. Adejimi Olawale, pointed out that some people were chosen to constitute the Transition Committee, but almost all members of the Transition Committee were voted in, which is not in support of the masses.
â€œIt was free and fair, but was not so good for us because most members of the Transition Committee were nominated and voted in and this must be as a result of some underground work that was done.â€