The National Credit Guarantee Company (NCGC) has helped unlock ?46.95bn in loans for Nigerians and businesses within one year of commencing operations, President Bola Tinubu has said.
Tinubu disclosed this while highlighting the impact of the company’s credit guarantee programme, which he said was created to address one of the major barriers preventing businesses from accessing finance.
According to the President, many viable businesses often struggle to obtain loans because lenders consider them too risky due to limited collateral or lack of credit history.
He said NCGC was established to reduce that challenge by taking on part of the lending risk faced by financial institutions.
‘Many viable businesses still meet the same obstacle at the bank. Lenders see too much risk in a sound business when the owner has little collateral or no credit history,’ Tinubu said.
‘We established NCGC to help change that. It carries part of the lending risk with participating financial institutions, giving them greater confidence to lend to businesses and borrowers they might otherwise turn away.’
The President said the company currently works with 19 financial institutions, including 13 commercial banks, three microfinance banks and three development finance institutions.
He stated that NCGC had issued ?21.59bn in guarantees, allowing participating lenders to extend ?46.95bn in loans.
Tinubu said the figures showed that every ?1 provided in guarantees had helped unlock about ?2.17 in credit.
He added that 67,512 borrowers across 25 states and the Federal Capital Territory had received credit backed by the scheme.
The beneficiaries include 11,374 women, while 33.5 per cent are first-time formal borrowers entering Nigeria’s credit system for the first time.
According to Tinubu, more than 22,000 Nigerians have now gained access to formal credit records, which could improve their chances of securing future loans through successful repayment.
He explained that access to credit was important because of what individuals and businesses could achieve with it.
‘A trader can restock before the festive season. When a manufacturer takes a bigger order and buys another machine to fill it, another Nigerian gets a job,’ he said.
The President said businesses supported through the NCGC programme were estimated to account for 661,291 direct and indirect jobs.
Tinubu said the initiative was part of efforts by his administration to move Nigeria towards a credit-based economy, where individuals and businesses can access financing to expand their activities.
He added that the government would continue to widen access to credit opportunities across the country.