The federal government has announced plans to launch a National Credit Guarantee Company before the end of the second quarter of the year.
President Bola Tinubu disclosed this during his New Year address on Wednesday.
He revealed that the company was the result of multi-stakeholder engagement across public and private sectors.
He said, “In this new year, my administration will further consolidate and increase access to credit for individuals and critical sectors of the economy to boost national economic output. To achieve this, the federal government will establish the National Credit Guarantee Company to expand risk-sharing instruments for financial institutions and enterprises.
“The company, expected to start operations before the end of the second quarter, is a partnership of government institutions, such as the Bank of Industry, Nigerian Consumer Credit Corporation, the Nigerian Sovereign Investment Agency, and Ministry of Finance Incorporated; the private sector; and multilateral institutions. This initiative will strengthen the confidence of the financial system, expand credit access, and support underserved groups such as women and youth. It will drive growth, re-industrialisation, and better living standards for our people.”
In 2024, the Tinubu administration launched the Nigerian Consumer Credit Corporation to democratise access to consumer credit for Nigeria’s working population.
The implementation of the programme was planned in stages, beginning with federal civil service employees and now the general public.
Meanwhile, the appetite of Nigerians for loans declined for the third consecutive month in October, according to the latest economic report released by the Central Bank of Nigeria.
According to the report, Nigerians have been focusing more on loan repayment since August, which has seen the consumer credit outstanding decline by 3.70 per cent to N4.69tn in August, then N4.25tn in September before settling at N3.50tn at the end of October 2024, indicating a 17.64 per cent dip month-on-month.
At the end of October, the report said that the decline in consumer credit outstanding followed the decline in personal and retail loans to N2.41tn (-23.49 per cent) and N1.09tn (-0.91 per cent), from N3.15tn and N1.10tn, respectively, in September.
Personal loans maintained their dominance, accounting for 68.95 per cent of total consumer credit, albeit lower than the 74.14 per cent in the preceding month, while retail loans constituted the balance.
Similarly, the report indicated that sectoral credit utilisation moderated by 5.13 per cent to N58.37tn compared with N58.57tn in the preceding month.
“The services sector maintained dominance in receipt of credit to key sectors of the economy, utilising 52.57 per cent, followed by industry and agriculture, which accounted for 43.31 and 4.12 per cent, respectively,” the report partly read.
