President Bola Ahmed Tinubu on Monday said the Federal Government’s National Credit Guarantee Company (NCGC) has helped unlock N46.95 billion in loans for 67,512 Nigerians and businesses within its first year of operations.
The President said the credit was mobilised on the back of N21.59 billion in guarantees issued by the company, translating to about N2.17 in lending for every N1 of guarantee provided.
Tinubu, in a message posted on his verified X handle, @officialABAT, said the figures demonstrated his administration’s determination to move Nigeria towards a credit-based economy in which workers and businesses could access financing without being held back by traditional collateral requirements.
The figures cited by the President are consistent with NCGC’s first-year performance, which showed that N21.59 billion in risk cover unlocked N46.95 billion in financing for 67,512 borrowers across 25 states and the Federal Capital Territory.
According to Tinubu, 11,374 of the beneficiaries are women, while 33.5 per cent of the total beneficiaries are first-time formal borrowers, bringing more than 22,000 Nigerians into the formal credit system for the first time.
He said the development would allow the new borrowers to establish credit histories which could improve their prospects of securing further financing as they successfully repay their loans.
‘When I sought your mandate, I promised to move Nigeria towards a credit-based economy and to establish a loan guarantee scheme that would help small businesses overcome the barriers that keep them from finance.
‘That promise was about something practical. A worker with access to credit can buy what the family needs and pay over time, and a small business can invest today against the income it expects tomorrow’, Tinubu said.
The President said his administration had been building institutions around the objective, pointing to the Nigerian Consumer Credit Corporation (CREDICORP), the Nigerian Education Loan Fund (NELFUND), the Bank of Industry (BOI), Development Bank of Nigeria (DBN) and NCGC as components of the emerging credit architecture.
He explained that while CREDICORP provides consumer credit to working Nigerians and NELFUND supports students with education financing, the NCGC was established to confront one of the biggest obstacles to business lending; the reluctance of financial institutions to lend to otherwise viable businesses with insufficient collateral or limited credit histories.
‘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.
‘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’, Tinubu said.
The NCGC operates by providing partial credit guarantees, sharing part of lenders’ exposure and consequently reducing the risk attached to lending to underserved businesses and consumers.
The company says its guarantees typically cover up to 60 per cent of outstanding loan principal, although higher coverage may apply to some strategic categories.
Tinubu said the company currently works with 19 participating financial institutions comprising 13 commercial banks, three microfinance banks and three development finance institutions.
He added that beyond the volume of loans already mobilised, the businesses supported under the guarantee arrangement were estimated to account for 661,291 direct and indirect jobs.
Independent reporting on NCGC’s first-year performance also put the number of jobs supported at 661,291 and confirmed that 11,374 of the 67,512 beneficiaries were women.
The President said access to credit was important not merely because of the amount of money disbursed but because of its capacity to expand businesses, stimulate consumption and create employment.
‘Credit matters because of what people can do 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.
Tinubu said the administration considered the expansion of credit as a critical bridge between its economic reforms and opportunities available to ordinary Nigerians.
‘This is how we move from reforms to opportunities. Our reforms laid the foundation. Credit gives Nigerians the means to build on it. Tens of thousands who stood outside formal credit a year ago are now inside, borrowing to grow’, he said.
The NCGC was created following a presidential mandate in August 2024 to address financing constraints confronting small businesses and underserved consumers.
Its mandate includes providing partial credit guarantees to reduce lending risks, improve access to finance and promote financial inclusion.
Tinubu pledged that his administration would continue expanding access to formal credit across the country, saying ‘we will keep widening that road until the opportunities our reforms create reach homes and businesses in every part of Nigeria.
‘Promise made, Promise Kept. We are moving from reforms to opportunities. Nigeria First’, the President added.