The Lagos State Government, in collaboration with the office of the Vice Presidency, organised SMEs Clinic for micro, small and medium enterprises, MSMEs, in the Lagos region previous week. At this backdrop, the President of the Association of Micro Entrepreneurs of Nigeria, AMEN, Prince Saviour Iche, in a chat with Financial Vanguard, said the federal government must ensure proper monitoring of intervention funds made available to development banks for on-lending to the MSMEs in order to ease access to credit, among other issues. Excerpt:
By Providence Emmanuel
What is your assessment of the SMEs Clinic?
I don’t think SMEs are sick, it is only those who are sick that need clinic, we are not sick so we don’t need clinic. The only people that I know are sick are the government agencies that take care of SMEs in Nigeria. I say this because they are not functioning, they are just there, they are existing but not productive.
How do you mean, when the agencies have been supporting the SMEs in various ways?
Loans are given on the pages of newspapers. As the president of an association of SMEs, if loans are given I will know because I have members across all the 36 states of the federation. Although they have been offering me but I rejected it because “it is a monkey come and take offer” it is not satisfactory. If we must get it right, we must tell ourselves the truth. The Bank of Industry, BoI, is working on personal interest.
Are you aware of some of your members that have accessed funds from BoI?
When you talk of accessing fund, accessing fund on what condition? when we have about 700 members in Lagos State and only three have accessed the fund. Even the fund they accessed, they are regretting because the condition of the loans are not favourable for entrepreneurs. Before they even got the little fund you are talking about, mind you they are not given a working capital, they are given an offer letter and they must buy machine which many of them do not need. Those machines are lying waste. So what fund are they giving them, when they even have to raise 10 percent upfront deposit to a commercial bank and two bank of industry staff would be a signatory to it. They have the right to withdraw the money at their own will.
Do you have evidence of these claims?
I have a case of a member who deposited N300, 000 in a commercial bank, recognised by BoI, for three years, that entrepreneurs was given N18,000 as interest rate accrued within the period. Give that same person that amount to do business in one week, you will get more than that money they gave as interest on the deposit in three years.
If the Nigerian MSMEs do not need a clinic, in your view, what do they need?
I am telling the federal government that these agencies should be upgraded, they should look into their activities, these agencies are giving the government a bad name. If they are working, the effect would be obvious. In 2017, about 28 members of AMEN closed their factories. I am not talking of other MSME associations. These entrepreneurs employ not less than three to ten workers.
If you multiply 10 people by 28, then you will understand how many people have been thrown back into the labour market in addition to the existing unemployed persons. Government should look into the activities of BoI, they should make access to fund easy. We should not use months and years to access funds. The issue of 10 percent upfront should be abolished.
What led to AMEN’s ejection from the Industrial Development Centre, IDC, in Ikorodu, Lagos?
That is why I said that the agencies are sick. We went to IDC in Ikorodu, the place was just bush lying fallow. So many of the members borrowed money to renovate the place to meet with the National Agency for Food and Drug Administration and Control, NAFDAC, registration requirement. A lot of our members had their products registered by NAFDAC as at the time.
All of a sudden, Small and Medium Enterprises Development Agency of Nigeria, SMEDAN, came and said they want to help us renovate the place that has already been occupied by the entrepreneurs. At first, we disagreed, we told them that there is no need to renovate because the land is about 19 acres. We pleaded with them to erect more clusters or allow us to use our money to build, they refused. They said we should just give them a little time to renovate the place, that after the renovation we would come back.
After much deliberation, we agreed. We never knew, they deceived us by using that avenue to eject us out of the place. As a law abiding association, we didn’t want to join issues with them. Of a truth, it is not our property but government property, but they should have at least given us an alternative. As I speak, most of the properties of my members, the property of these entrepreneurs are lying waste in the bush for over six months.
Are there renovations going on at the site?
They have renovated some places but do you know that they turned it to staff quarters, SMEDAN staff quarters. They have ejected the small business owners from their production cite and they are using it as SMEDAN staff quarters.