Nigeria: Lagos State, Others Urge CBN To Reduce Interest Rate To 5% To Encourage MSMEs

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Lagos State Governor Akinwumi Ambode has called on the Central Bank of Nigeria (CBN) to consider pegging the N220 billion Micro Small and Medium Enterprises intervention loan at 5 per cent to encourage more off take.

Governor Ambode made the call while delivering his opening remark at the 9th annual bankers committee retreat which held in Lagos with the theme, ‘Improving Financial Access, Enabling Job Creation and Driving Inclusive Growth in Nigeria’.

The governor’s comment was a direct response to CBN Governor, Godwin Emefiele who had expressed disappointment that since creating the N220bn MSME’s fund in 2013, less than half of that amount has so far been accessed by banks for their customers.

Ambode said: “We need the economy to grow at 7 per cent and we need to be creating at least four million jobs if we must carter for the growing rate of our population.”

The comment, which drew applause from the participants at the retreat, also saw Mrs Bola Adesola, the Chairman, Sub-Committee on Economic Development, Sustainability and Gender saying, “We must remember that a sizeable chunk of that N220 billion is reserved for women and the feelers we get from them is that, they cannot survive with 9 per cent, so we need to bring it down to facilitate draw down.”

He noted that all hands must be on deck to create more jobs for the people and ensure 6.7 per cent annual growth rate.

Responding to an earlier comment by Mr. Godwin Emefiele, on the inability of the Micro Small and Medium Scale Enterprises (MSMEs) to access the N200b fund earmarked for them, Ambode said the easiest way to achieve same was to reduce the lending rate to about five per cent or lower.

At the state level, he added, his administration created the Employment Trust Fund through which about N10b had been disbursed to the MSMEs at five per cent with over 6,000 benefiting so far. He tasked the CBN to replicate such at the federal level.

The Minister of Agriculture, Chief Audu Ogbeh, in a passing remark over  Governor Ambode’s comment, said, “I support the 5 per cent”, while Kebbi State Governor Bagudu Abubakar Atiku hinted that he will push for zero interest rate.


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