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HomeStartups & SMEsSmall Businesses Dominate Banks' Lending Plans 

Small Businesses Dominate Banks’ Lending Plans 

With commitment to lend more to SMEs, many businesses are exploring Access Bank Plc's  flexible credit policy by borrowing from the bank to expand their operations. 

The World Bank and Central Bank of Nigeria (CBN) acknowledge the crucial role played by financial institutions in funding Mi­cro, Small and Medium Scale En­ter­prises (MSMEs) for sustainable growth and economic development. 

With commitment to lend more to MSMEs, many businesses are exploring Access Bank Plc’s  flexible credit policy by borrowing from the bank to expand their operations. 

The World Bank says improving Mi­cro, Small and Medium Scale En­ter­prises (MSMEs’) access to finance and finding innovative solutions to unlock sources of capital should be priority for every far-sighted commercial bank.

Reason being that MSMEs play a major role in most economies, particularly in developing countries. They account for the majority of businesses worldwide and are important contributors to job creation and global economic development. 

In Nigeria, most formal jobs are generated by MSMEs, which create seven out of 10 jobs. However, access to finance is a key constraint to MSME growth, it is the second most cited obstacle facing MSMEs to grow their businesses in emerging markets and developing countries.

The MSMEs are less likely to be able to obtain bank loans than large firms; instead, they rely on internal funds, or cash from friends and family, to launch and initially run their enterprises. 

Also,  over 40 mil­lion MSMEs ex­ist in the coun­try, em­ploy­ing over 80 per cent of the coun­try’s pop­u­la­tion and con­tribut­ing about 50 per cent of the coun­try’s Gross Do­mes­tic Prod­uct (GDP).

The Central Bank of Nigeria (CBN) Governor, Godwin Emefiele, said disclosed that globally, MSMEs were last year con­fronted with shocks oc­ca­sioned by the dis­rup­tive im­pact of the COVID-19, with those in Nige­ria badly af­fected.

To address the chal­lenges fac­ing MSMEs, Ac­cess Bank had un­folded var­i­ous forms of sup­port for op­er­a­tors of such busi­nesses, through the $50 mil­lion loan sup­port the bank se­cured from the In­ter­na­tional Fi­nance Cor­po­ra­tion (IFC).

Ac­cess Bank’s Group Man­ag­ing Di­rec­tor, Her­bert Wigwe, said the bank was com­mit­ted to help­ing Nige­rian busi­nesses weather COVID-19 pan­demic and set a course for recovery.

Ac­cord­ing to Wigwe, the funds  helped the bank in­crease liq­uid­ity to sev­eral Nige­rian small and medium-sized en­ter­prises nav­i­gat­ing the eco­nomic chal­lenges of COVID-19.

“In Nige­ria, SMEs con­trib­ute over 45 per­cent of na­tional GDP, ac­count for about 96 per­cent of busi­nesses and 84 per cent of em­ploy­ment. Ac­cess Bank, there­fore, recog­nises the im­por­tance of SMEs to eco­nomic sta­bil­ity and is go­ing the ex­tra mile to en­sure that such busi­nesses are ad­e­quately fi­nanced to weather these test­ing times,” he said.

“In Nige­ria, SMEs con­trib­ute over 45 per­ cent of na­tional GDP, ac­count for about 96 per­cent of busi­nesses and 84 per cent of em­ploy­ment. Ac­cess Bank, there­fore, recog­nises the im­por­tance of SMEs to eco­nomic sta­bil­ity and is go­ing the ex­tra mile to en­sure that such busi­nesses are ad­e­quately fi­nanced to weather these test­ing times,” he said.

Ac­cord­ing to him, the IFC’s fund­ing has not only en­abled the bank to ex­tend fi­nan­cial re­lief to clients across all sec­tors dur­ing the pan­demic, but be­yond the COVID-19 cri­sis as well.

Wigwe said the part­ner­ship with IFC would also help set Nige­rian busi­nesses on a recovery path.

The funds from the loan, made through IFC’s global COVID-19 ‘Fast-track Fi­nanc­ing Sup­port Pack­age’ en­abled Ac­cess Bank to pro­vide in­creased trade fi­nanc­ing and work­ing cap­i­tal lend­ing to its busi­ness clients ex­pe­ri­enc­ing dis­rupted cash flows, sup­port­ing busi­ness ac­tiv­ity and pre­serv­ing jobs.

The funds from the loan, made through IFC’s global COVID-19 ‘Fast-track Fi­nanc­ing Sup­port Pack­age’ en­abled Ac­cess Bank to pro­vide in­creased trade fi­nanc­ing and work­ing cap­i­tal lend­ing to its busi­ness clients ex­pe­ri­enc­ing dis­rupted cash flows, sup­port­ing busi­ness ac­tiv­ity and pre­serv­ing jobs.

Re­it­er­at­ing Wigwe’s com­ments, IFC Coun­try Man­ager for Nige­ria, Eme Essien Lore, said, “It is cru­cial to sup­port smaller busi­nesses to keep the wheels of Nige­ria’s econ­omy turn­ing dur­ing to­day’s un­prece­dented eco­nomic chal­lenge.

“IFC’s long­stand­ing part­ner­ship with Ac­cess Bank means to­gether we can move much-needed fund­ing to busi­nesses that need it most, help­ing them re­main in busi­ness and re­tain their em­ploy­ees.”

Ac­cess Bank, Africa’s largest re­tail bank, serves more than 36 mil­lion cus­tomers across a net­work of 677 branches.

Ac­cess Bank, Africa’s largest re­tail bank, serves more than 36 mil­lion cus­tomers across a net­work of 677 branches.

In line with its drive to sup­port en­tre­pre­neur­ial spirit in the coun­try, the bank re­cently re­warded serv­ing mem­bers of the Nige­ria Youth Ser­vice Corps (NYSC) with over N15 mil­lion in the third edi­tion of the bank’s youth busi­ness chal­lenge com­pe­ti­tion, Ac­cessprenuer.

The com­pe­ti­tion was held si­mul­ta­ne­ously across five NYSC camps in Abuja, Osun, Enugu, Nas­sarawa and Rivers States.

Ac­cord­ing to the bank, five top win­ners won N1 mil­lion each, while others were re­warded with con­so­la­tion cash prizes to­tal­ing N10 mil­lion dur­ing the fi­nal busi­ness pitch of the con­test for NYSC 2021 Batch A Stream II Ori­en­ta­tion Course.

Ac­cord­ing to the bank, five top win­ners won N1 mil­lion each, while others were re­warded with con­so­la­tion cash prizes to­tal­ing N10 mil­lion dur­ing the fi­nal busi­ness pitch of the con­test for NYSC 2021 Batch A Stream II Ori­en­ta­tion Course.

Win­ners of the N1 mil­lion star prize were Eas­ngbedo Pre­cious in Abuja camp; Nwakor Favour Alex in Osun; Olu­sanya Mir­a­cle in Rivers; Omoha ar­inze in Enugu, and Eg­be­wole Ab­dul­jelli in Nas­sarawa camp.

Speak­ing on the Ac­cessprenuer chal­lenge ini­tia­tive, Ex­ec­u­tive Di­rec­tor, Re­tail Bank­ing, Ac­cess Bank Plc, Vic­tor Etuokwu, said: “The chal­lenge is aimed at pro­mot­ing en­tre­pre­neur­ial as­pi­ra­tions among tal­ented corp mem­bers. So far, the com­pe­ti­tion has proved to have a great im­pact on youth em­pow­er­ment in the coun­try as we re­ceived more en­tries dur­ing the cur­rent chal­lenge.

Sim­i­larly, the bank re­cently launched what it termed the ‘Di­a­mond Busi­ness Ad­van­tage (DBA) lite’ as part of ef­forts to in­crease its dig­i­tal loans and en­hance ac­cess to fi­nance for young en­trepreneurs.

The bank said the prod­uct which is tar­geted at the youths was de­signed to add value to mi­cro, small and medium scale en­ter­prises.

The bank said the prod­uct which is tar­geted at the youths was de­signed to add value to mi­cro, small and medium scale en­ter­prises.

Speak­ing dur­ing the launch of the prod­uct in La­gos, re­cently, Etuokwu, said, en­trepreneur­ship is es­sen­tial for the growth of any na­tion.

He said: “DBA Lite is a prod­uct of the erst­while Di­a­mond bank via the Di­a­mond Busi­ness Ac­count (DBA) and that was one of the best prod­ucts in the mar­ket but af­ter the merger, we re­named it as DBA but this in­no­va­tion; DBA Lite is tar­geted for the youths who are start-ups, es­tab­lished or grow­ing. This in­no­va­tion will bring ac­cess to dig­i­tal loans for the youths be­cause that is what we want to do with this in­no­va­tion.”

Etuokwu noted that the dig­i­tal loan would be in the form of N50,000 to N5 mil­lion, adding that en­trepreneurs can only ac­cess the loan once they meet the re­quire­ments.

Ac­cord­ing to him, Ac­cess Bank ac­counts for over 50 per cent of dig­i­tal loans in the in­dus­try be­cause it is gives such loans at an aver­age of N18,000-N20,000 daily.

The pro­gramme was de­signed to cre­ate an en­abling en­vi­ron­ment for fe­male en­trepreneurs to grow their busi­nesses.

The Group Head, ‘W’ Ini­tia­tive, Ac­cess Bank, Ms. Ay­ona Trim­nell, said Ac­cess Bank has been a lead­ing ad­vo­cate for women’s eco­nomic em­pow­er­ment in Africa.

She added: “We launched the first Women­preneur pitch-a-ton ini­tia­tive in 2019 in line with our value propo­si­tion to be the num­ber one bank of choice for women in Nige­ria, and we have re­ceived over 100,000 ap­pli­ca­tions over the last two years.

She added: “We launched the first Women­preneur pitch-a-ton ini­tia­tive in 2019 in line with our value propo­si­tion to be the num­ber one bank of choice for women in Nige­ria, and we have re­ceived over 100,000 ap­pli­ca­tions over the last two years.

“In 2020, de­spite the pan­demic, we were able to ex­pand the pro­gramme to other fe­male en­trepreneurs across seven African coun­tries with three win­ners emerg­ing from Sierra Leone, Ghana and Zam­bia out of 50 fi­nal­ists. “This year we are mak­ing the pro­gramme big­ger and bet­ter by in­creas­ing the num­bers to 100 women en­trepreneurs who will emerge as fi­nal­ists.

“The pro­gramme will also be open­ing up to a to­tal of 9 African coun­tries Nige­ria, Ghana, Zam­bia, Rwanda, Mozam­bique, Kenya, Demo­cratic Repub­lic of Congo, Sierra Leone and the Gam­bia.”

“The pro­gramme will also be open­ing up to a to­tal of 9 African coun­tries Nige­ria, Ghana, Zam­bia, Rwanda, Mozam­bique, Kenya, Demo­cratic Repub­lic of Congo, Sierra Leone and the Gam­bia.”

The 2021 Women­preneur Pitch-a-ton Africa pro­gramme was un­veiled on Mon­day and will run through Au­gust 13, 2021. It of­fers fi­nan­cial grants, an ex­clu­sive cer­ti­fied ca­pac­ity build­ing pro­gram and busi­ness coach­ing aimed at em­pow­er­ing women en­trepreneurs.

The 2021 Women­preneur Pitch-a-ton Africa pro­gramme was un­veiled on Mon­day and will run through Au­gust 13, 2021. It of­fers fi­nan­cial grants, an ex­clu­sive cer­ti­fied ca­pac­ity build­ing pro­gram and busi­ness coach­ing aimed at em­pow­er­ing women en­trepreneurs.

On his part, Wigwe said: “For us at Ac­cess Bank, sup­port­ing and em­pow­er­ing women is truly at the heart of our strat­egy and other things we have to do as far as sus­tain­abil­ity is con­cerned.

On his part, Wigwe said: “For us at Ac­cess Bank, sup­port­ing and em­pow­er­ing women is truly at the heart of our strat­egy and other things we have to do as far as sus­tain­abil­ity is con­cerned.

“In the last cou­ple of years, we have made sig­nif­i­cant progress as a bank and there have been sev­eral things that have been done in terms of sup­port­ing women.

“The ‘W’ ini­tia­tive is sup­posed to in­spire and em­power women as well as fe­male en­trepreneurs. When we started do­ing it, some peo­ple thought it was a joke.”

With the in­tro­duc­tion of the W Power Loan, fe­male owned busi­nesses can now re­quest loan from the bank just af­ter 30 days of op­er­at­ing an ac­count.

Wigwe has also been recognised as the African Banker of the Year at the 2021 edition of the African Banker Awards.

A winner of one of the most prized categories at the Awards ceremony for the second consecutive year, Wigwe was recognised for his stellar leadership in the market expansion of Sub-Saharan Africa’s largest bank despite the negative impact of the COVID-19 pandemic. Over the last 12 months, Access Bank has established a presence in South Africa following its acquisition of Grobank.

Accepting the award, Wigwe said Access Bank is focused on promoting corporate discipline, adding that the Bank wants to be in key markets on the continent, building a payment gateway and providing trade finance support.

“We want to be seen as the best bank supporting the African Continental Free Trade Area agreement (AfCFTA). In terms of diaspora remittances, we are present in key areas in the continent,” he said.

The African Banker Awards have become the most respected and recognised industry event celebrating African banking achievements.The organisers this year, put emphasis on recognising and rewarding institutions that contributed to the real economy which has suffered from the impact of Covid-19 as well as contributed to women empowerment on the continent.

Commenting on the award, Group Publisher of African Banker and Chair of the Awards Committee, Omar Ben Yedder said, “Herbert is one of the most respected bankers on the continent, without a shadow of a doubt. The Bank has gone from a lower ranked Nigerian bank when he joined the group as Deputy CEO to become one of Africa’s leading financial services groups. He has shown a relentless pursuit for growth, but has done so in a measured and calculated manner. What he and his team have done at Access Bank is nothing short of remarkable.”

The awards ceremony held virtually during the Annual meetings of the African Development Bank.

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