Post Views: 543 Vice President Yemi Osinbajo, on Monday in Abuja said the Muhammadu Buhari administration has so far disbursed over N15bn in interest-...
Vice President Yemi Osinbajo, on Monday in Abuja said the Muhammadu Buhari administration has so far disbursed over N15bn in interest-free loans under its The loans ranging from N50,000 to N350,000, he told participants at the ongoing 24th Nigeria Economic Summit (NES), with the theme: “From poverty to prosperity; Making Governance and institutions Work,” he said more than 300,000 market women, traders, artisans, and farmers across the country, including the FCT have benefited.
He noted that 56% of those loans have gone to women, adding that a lot of these small traders are accessible through mobile phones, as many without mobile phones share with others.
Osinbajo said the government is currently “looking at how this would expand financial inclusion and, on account of this, we’ve been able to open about 349,000 new bank accounts. And we are working with between six and 10 of the banks to be able to open bank accounts for many of these individuals, so they can have more access to credit, financial training and all of what being in a formal economy would provide for them. So, we give them a stronger chance to earn more, while they also service the value chain that they are already a part of. But more importantly, we bring them into the formal sector, where they have access to government patronage.”
He added that the GEEP is different from the government’s Trader Moni programme, or the Market Moni programme, “an important component of giving micro- credit to the bottom of the trading pyramid, smallest businesses, the one table trader, the bread or plantain seller or the maishai (those who sell tea by the road side) or maisuya (shish kebab seller) and all of the very small traders… Most of them, their total inventory is not even usually up to about N5,000.”
Continuing, the Vice President recalled: “When I went to launch the scheme at the Nyanya market, there was a woman who was selling her kpomo, for those who do not indulge that delicacy; it is the hide of a cow. So this lady had her kpomo in a bucket, and it had water in it. And I asked her how much it was, she said everything there was about N3,000. So I said to her, “what is your profit? How do you make profit from it?” And she pointed to the woman who was standing right next to her. The woman who stood right next to her had her own kpomo in a little bowl, it was like she was saying, “I am a big player here, look at this one.
“So, a lot of these people are really the bottom of the pyramid, but they are hard working… they are in that value chain making their contributions. And one of the ways that we thought we could really add some value to them, is by enabling them to buy more, improving their inventory so they can improve their own capacity to earn. Most of them, as I’ve said, are the small and last in that value chain, they sell the single sachets of soap, sugar, and spices to the largest numbers of our people. But they are forgotten and ignored in economic plans and budgets, and they are considered too unwieldy and risky for micro credit loans.”
Under the scheme, he said government is “giving micro-credits to about two million of these petty traders across the country, and the scheme enables them to draw further credit if they are able to pay back within six months.
With the new bank accounts, he stressed, it is now possible to study the pattern in Nigeria’s informal sector a bit better, especially in such challenging area as collection of taxes among the very large informal sector players.
“But bringing in several into the net, into the formal sector, would, of course, enable us to improve even on our very low tax-to-GDP ratio, which is now close to I think about six per cent.
In a bid to enable the formal sector, he said the administration has tried to provide infrastructure for small economic clusters and markets by providing solar power for small businesses and petty traders.
“In Ariaria market in Aba, we’ve provided Solar Power for over 31,000 shops; in Sabongari market in Kano, we’ve provided solar power for over 13,598 shops. We are opening Sura market in Lagos on Friday, where we are providing for over 1,000 shops in the first place. We are also going to be doing Balogun market in Lagos and have done Gbagi market in (Ibadan) Oyo. We’ve done in Ondo state about three markets already; Isikan market, NEPA 1 and 2, where we’ve done close to a thousand shops as well. In total, we’ve given solar power to about 81,691 and we have serviced over 300,000 MSMEs.”