Saraki: Collateral Registry, Credit Reporting to Boost MSMEs

Date: 2017-09-07

Senate President, Dr. Abubakar Bukola Saraki has said that the new legislations – Secured Transactions in Movable Assets Act and the Credit Reporting Act – passed by the National Assembly last June and immediately signed into law by then acting President Yemi Osinbajo will support the growth of micro, small and medium sized enterprises (MSMEs) through increased bank lending and reduce bank exposure to loan defaults through pre-examination of credit worthiness for would be borrowers.

Under the law, potential borrowers can now register assets other than land and property as collateral to secure a loan. Also, one can register his/her automobile or other worthy assets.

Securing financing through loans has long been a problem for Nigerian entrepreneurs. Most MSME owners must rely on personal savings or loans from family and friends to launch their business ventures. The new law, also known and the Collateral Registry Act, allows banks to increase lending to MSMEs, while not negatively impacting their balance sheets.

Saraki who hailed the passage and the opportunity for economic and MSME growth the new laws afford Nigerians stated that "this is a win-win situation for our economy and society." "The private sector, the federal government and the National Assembly worked together to create the enabling environment for MSMEs to grow, diversify the economy and increase employment.

"We should all be proud of delivering a law that will allow many people to provide for their families and community," he added.

The Credit Reporting Act allows credit information sharing between credit bureaux and those companies that lend money or extend credit for goods and services.

Under the Credit Reporting Act, companies will have access to the credit history to review whether there is a history of loan defaults or other financial blemishes. This extra layer of protection will serve to reduce lending risks, while preserving credit services to borrowers with good credit histories.

"Combined, the new laws make good economic and business sense" Already bank lending to MSMEs has increased and is expected to grow considerably for the remainder of the year and in 2018”, a note from Saraki's Media Office stated.

Saraki further noted: “In both developed and developing economies small business growth is the engine of the economy and employment growth. With a high unemployment in Nigeria, the growth and support for MSMEs is critical.

“The National Assembly will also be looking to see what existing support programmes are working and can be created to help MSMEs’ owners to better understand the use of credit, management skills training, mentor relationships, marketing and how to pursue government procurement contracts,"Saraki added.


Click to add/read Comments



Cloud Tag: What's trending

Click on a word/phrase to read more about it.

Onilorin     Saka Keji     Saka Adeyemo     Jimba Babatunde     Oko-Erin     Saidu Isa     Busari Alabi Alausa     Modupe Oluwole     Ibrahim Issa Jetti     Afolayan     Bahago     Olateju Lukman     Omupo     Muftau Akanbi Oke     Aisha Abodunrin Ibrahim     Olofa Of Offa     George Innih     Abdullahi Imam Abdullahi     Unilorin     Al-Ilory     Obuh     Toyin Sanusi     Valsolar Consultoria     Tanke     Kulende     Abdulkarim Adisa     Kwara State Government     Apaokagi     Joseph Daudu     Abdulrahman Abdulrazaq     Women For Change And Development Initiative     Yinka Aluko     UTME     Mustapha AbdulGaniyu     Muhammed Abdullahi     Obasanjo     Kannike     Sulyman Atolagbe Alege     Funke Adedoyin     Agbarere     Moronfoye     Sheriff Shagaya     Tinubu     NURTW     Isau     Oke-Ode     Demola Banu     Niyi Osundare     Yusuf Babatunde Abdulwahab     Ayedun     Omoniyi Ayinla     Ishaq Salman     Elerinjare     Shao     Tosin Saraki     KWASAA     Ilesha-Baruba     Taofik Abdulkareem Babaita     Code Of Conduct Bureau     Saidu Yaro Musa     Presidential Election     Mufutau Gbadamosi Esuwoye     Abubakar Olusola Saraki     Jaigbade Alao     Moro     Bureau Of Lands     Bankole Omisore     Mohammed Alabi Lawal     Falokun-Oja     Oke-Ogun     Jaiz Bank     Funmilayo Oniwa     Ojo Fadumila     LEAH Charity Foundation     Taiwo Joseph     Jani Ibrahim     Toyin Saraki