Some owners of businesses, especially the small and middle ones, have expressed their reservations over the planned introduction of the National Credit Guarantee Company (NCGC) scheme, expected to kickoff in May, this year.
They noted that the initiative, which is part of the federal government’s reforms aimed at boosting critical sector of the economy, and enhancing productivity, by filling financial gaps in the sectors, may not achieve the desired objective of enhancing the fortunes of individuals and businesses, due to likely abuse.
In separate chats with the Nigerian Tribune, the business operators hinged their pessimism of the scheme on similar ones that ended up being hijacked by the privileged few, after being launched.
Eyitayo Balogun, the Chief Executive of a modest, but thriving pharmaceutical company, in Lagos, noted that NCGC would have been the best thing to have happened to MSMEs this year, but for the ‘Nigerian factor’.
According to Balogun, who would not want the name of his pharmaceutical company in print, the introduction of such scheme would have helped solve the challenges businesses in the sector face before getting loans, to enhance their fortunes.
“Even where those loans are available, the interests on them are very high. Ordinarily, what the advent of NCGC would have done would be to allay the fears of the nation’s financial institutions that consider giving loans to some businesses as high risk, since they now know that government is involved through the NCGC. But the challenge is that the scheme may be hijacked by the privileged few, and as a result, not get to the targets at the end of the day,” he stated
Speaking in the same vein, Gloria Nkiruka, who runs a supermarket in Iyana Ipaja area of Lagos, told NT she was hearing of the initiative, which her business should be a major beneficiary for the first time.
She also expressed the scepticism about the scheme achieving the objectives for which it was set up.
“If you are talking of the scheme benefiting individuals and businesses, I think we should be one of the beneficiaries. But, the challenge with this type of scheme is that when it eventually kicks off, many business owners would not even know how to go about it,” she stated.
Gloria therefore stressed the need for some form of public enlightenment campaigns, to enable the real targets to benefit from the scheme.
Adams Makinde, a fashion designer, believed NCGC could serve as a game changer for businesses, especially the small and medium ones ; since accessing facilities from the regular financial institutions, has always been a tough call.
“Last year, I had the plan to expand this business by buying some machines, venture into other categories of fashion designing, and employing more hands. I could only achieve part of the dreams, through a monthly contribution ‘ajo’ that I was doing with other fashion designers. You can imagine if this type of scheme had been there, and accessible, the business would not be where it is today,” Makinde added.
Makinde believed if allowed to work, Nigerian businesses would be the better for it.
Biyi Adesuyi, a finance expert, and Chief Executive Officer of Wealthgate Advisors, also expressed the belief that the scheme would positively impact the economy, if well implemented.
“Though I wouldn’t know how they intend to run it, but I believe if it is well run, it will be good for the economy,” he stated.
Adesuyi described the idea as not novel; since there had been similar initiatives in the past, but which were rendered ineffective, due to abuse.
“The challenge with the Agric Credit Scheme then was that those who should qualify were not allowed to access it. The powers-that-be and their cronies hijacked the scheme, and we all saw the results,” he stated.
Going forward, Adesuyi would want government to involve professionals to manage the scheme when it eventually commences in May, this year, so as to check the issue of abuse.
“Let those professionals study where similar scheme had initially failed, and how it was revamped and redesigned to achieve its goals,” he stated
The Wealthgate Advisors’ boss also warned of the consequences of making ‘portfolio’ businessmen have access to such scheme.
“These are businessmen that collect the facility and use it to enjoy themselves without expending it on the purpose it’s meant for, thereby denying others of such funds at the end of the day, since they are not always repaid,” he stated.
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