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MSMEs to receive single-digit interest loan

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By Okunloye Abiodun

Proactive measures are taken to fuel the growth of MSMEs within the nation.

The federal government is taking proactive measures to fuel the growth of Micro, Small, and Medium-sized Enterprises (MSMEs) within the nation. To achieve this, Temitola Adekunle-Johnson, senior special assistant to the President on MSMEs and Job Creation, has disclosed that the government intends to facilitate a ₦75 billion loan with a single-digit interest rate for small business operators by 2024. During a conversation with Channels Television, Johnson stressed the significance of President Tinubu’s leadership in focusing on the development of the sector.

This will bolster the smooth operation of businesses in Nigeria. It will also empower small and medium enterprises to easily approach banks and secure loans at an interest rate as low as 9 percent. It was emphasized that Tinubu’s administration fully comprehends the significance of MSMEs to the nation’s economy. Consequently, every effort will be made to ensure that the implementation of this single-digit loan scheme proceeds swiftly and flawlessly, without any hindrances or obstacles.

Nigeria houses 36.9 million MSME’s – 96.7% of the country’s businesses.

In order to enhance the ease of conducting business in Nigeria, their focus for 2024 is to ensure a smooth operational process. The upcoming year holds a distinctiveness that sets it apart from previous ones, as emphasized by the affirmation of the President’s vision. With about 36.9 million MSMEs, Nigeria proudly houses these enterprises as they make up a significant 96.7 percent of the country’s total businesses. What’s particularly noteworthy is that a remarkable 67 percent of these businesses are owned by the youth.

Also, in the past year, the vice president’s office made an announcement regarding the opportunities for small businesses. They declared that in collaboration with the Bank of Industry (BOI), these businesses are entitled to a loan with a single-digit interest rate. Vice President Shettima announced on June 27, 2023, that the government is diligently striving to facilitate swift accessibility to loans with single-digit interest rates for small businesses in Nigeria. This concerted effort aims to expedite the process as efficiently as possible, aligning with the commemoration of World Micro Small and Medium Enterprises Day in 2023.

They contribute 45 percent of the nation’s Gross Domestic Product.

According to Trading Economics global macro models and analysts’ expectations, the Manufacturing Purchasing Managers Index in Nigeria experienced a surge in December 2023, reaching 52.70 points, as opposed to the 48.0 points registered in November. It is anticipated that by the conclusion of Q2 2024, the index will settle at around 50.60 points. Nigeria’s economy heavily relies on the active participation of MSMEs, which exert considerable influence. These entrepreneurial ventures spearhead progress by fostering innovation, generating employment, and instilling healthy competition across various industries.

Unsurprisingly, MSMEs contribute a significant share of 45 percent to the nation’s Gross Domestic Product, primarily dominated by the micro segment, accounting for a staggering 98.8 percent. Such businesses also assume responsibility for nearly 90 percent of all jobs present in the country, making their efficient operation absolutely crucial for sustainable growth. It serves as the backbone of various sectors, ranging from manufacturing and agriculture to technology and services, but operates on a smaller scale in comparison to massive corporations.

Related Article: Over-regulation is affecting Nigeria’s MSMEs  

These enterprises possess unique qualities, including limited manpower, reduced capital investment, and localized operations. They are renowned for their remarkable agility and adeptness in promptly adjusting to the ever-changing market demands. In emerging markets, these entities possess the ability to be creative and unveil unique opportunities that directly address the preferences and requirements of the local populace. Additionally, they play a vital role in creating job opportunities, thus significantly diminishing unemployment rates. Moreover, they tend to have lower prerequisites in terms of formal education and training, opening up avenues for a wider demographic to engage with them.


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AN-Toni
Editor
1 month ago

MSMEs to receive single-digit loan in 2024. Proactive measures are taken to fuel the growth of MSMEs within the nation. – Express your point of view.

SarahDiv
Member
1 month ago

I welcome the government’s initiative to support MSMEs with a ₦75 billion loan at a single-digit interest rate. This move acknowledges the crucial role MSMEs play in our economy, contributing significantly to GDP and job creation. It’s heartening to see efforts to ease access to funds for small businesses, promoting growth and innovation. I hope these measures lead to a more vibrant and sustainable economic landscape for Nigeria.

Adeoye Adegoke
Member
1 month ago

I couldn’t agree more with the proactive measures being taken to fuel the growth of MSMEs within the nation. Providing single-digit loans to MSMEs in 2024 is a game-changer. It will undoubtedly give a much-needed boost to these small businesses and contribute to their expansion and success.
Access to affordable financing is crucial for the growth and development of MSMEs. By offering loans at single-digit interest rates, the government is making it easier for these businesses to access capital and invest in their operations. This will enable them to expand their production capacity, hire more employees, and ultimately contribute to job creation and economic growth.
Lower interest rates on loans can significantly reduce the financial burden on MSMEs, allowing them to allocate more resources towards innovation, research, and development. This, in turn, can enhance their competitiveness in the market and enable them to seize new opportunities. It’s a win-win situation for both the businesses and the economy as a whole.
I believe that these proactive measures will not only benefit individual MSMEs but also have a ripple effect on the overall economy. As these businesses flourish, they will generate employment, increase tax revenues, and contribute to the development of local communities. It’s a step in the right direction towards building a more inclusive and sustainable economy.

Kazeem1
Member
1 month ago

Giving MSMEs single-digit loans is a proactive and motivating way to support their expansion. MSMEs are essential for boosting the economy and generating employment opportunities, and their growth and development can be greatly aided by having access to affordable finance.

Taiwo
Member
1 month ago

2024 loan amounts for MSMEs will be in the single digits. In the country, proactive steps are implemented to support the expansion of MSMEs. MSMEs are getting single-digit loans, which is excellent to see. The growth of their company will be enhanced by it.The important importance MSMEs play in our economy is acknowledged by this action.