Breaking News

LAPO disburses N14bn loan per month — CEO

Kindly Share This Story:

…Says competition would create greater institutions

By Providence Emmanuel

LAPO Microfinance Bank, has said that it disbursed up to N14.1billion loans per month to customers across the country as part of efforts to address the incidences of poverty, poor health, among other ills in the Nigerian society.

Naira, CBN

FINTEC tackles financial exclusion: Xpress Payments injects N6n into economy(Opens in a new browser tab)

Managing Director/Chief Executive, LAPO MfB, Mr. Godwin Ehigiamusoe, disclosed this while fielding questions from journalists at the bank’s Lagos office. He said that competition in the MfB sub sector would engender greater institutions.

Ehigiamusoe explained that LAPO MfB was borne out of the realization of the place of access to finance which is now called “financial inclusion”, after 25 years when the bank first conceived it, stressing that credit is a core tool used by LAPO to tackle poverty.

He said that the bank in 2013, disbursed $1billion as loan to customers and N137 billion and N126 billion in 2018 and 2017 respectively, increasing consistently on an annual basis from N300 loan it started with years back.

Ehigiamusoe stated: “Financial services are very important which is why we prioritize credit;  we are not a deposit-led organization, we can take deposit because we are registered but we prioritize credit, because it is very important. Where as we mobilize deposit of about N2 billion to N3 billion every month, we give out an average of N13 billion to N14 billion every month as loan. We try to do things in a very informal manner, you cannot see glasses in our branches, most of our things are done in an informal manner.

“From day one, we were prompted by incidence of poverty. When the government of Babangida adopted the Structural Adjustment Programme, SAP, in April 1986, the component of SAP were devaluation of the naira, rationalization of staff in the public sector and that led to the incidence of poverty, which went up sharply.

“We are focused on poverty, we realized the place of access to finance 25 years ago, which is now called financial inclusion. The place of access to finance in poverty alleviation is strong. We would continue to do what we have been doing and ensure that we reach a larger number of people with financial services because you cannot make meaningful impact on poverty except you are able to reach a large number of poor people.

“So we want to scale up, to reach a larger number of poor people with our services, especially, our loan product. In 2013, we celebrated equivalent of $1billion, last year we disbursed N137 billion, year before, we did N126 billion.

“We have consistently; from N300 loan increased the volume of loan, which is our key strategy for poverty alleviation.

“So credit is the core tool we use to tackle poverty. There are also unintended consequences, not in the negative, unintended impact we never thought about, which is unemployment. LAPO is one of the major employers today. We have about 7,000 people in employment, when I was young and setting up LAPO, I did not see that as an objective but today it is real,” he said.

On the Central Bank of Nigeria, CBN,  policies, he stated: “I have raised it with the CBN, as a leader in the industry and somebody who has spent all my life in the industry, I told them that there is a danger, the danger is this, it is not every policy you have for the commercial banks that you can bring to the MfB subsector.This has been creating a lot of issues.

“LAPO has been there for years, but most of these MfBs have not been able to develop internal capacity. For me, I think there is a need for a rethink on some of their policies, I feel for the industry.

Commenting on the establishment of NIRSAL MfB , he pointed out that it would engender a healthy competition. He said: “In business case, I feel it would engender competition and eventually competition benefit two segments: the customers, they are likely to have a more efficient and cheaper service delivery. The second beneficiary is the institutions; their processes would strengthen their capacity and make them more efficient. I do not see it in any negative form but I see it as greater competition and there is going to be the emergence of greater institutions.

Also he added that the recapitalization exercise of the CBN is not bad, largely because lending requires a strong capital base, saying: “I think that what the CBN has done which is quite different and better than the former policy is commendable.”


Kindly Share This Story:
All rights reserved. This material and any other digital content on this platform may not be reproduced, published, broadcast, written or distributed in full or in part, without written permission from VANGUARD NEWS.


Comments expressed here do not reflect the opinions of vanguard newspapers or any employee thereof.
Do NOT follow this link or you will be banned from the site!