The recent plan by the Central Bank of Nigeria to transform NIPOST into a microfinance bank with branches in all the 774 local government areas of the country, using NIRSAL as a platform is a move in the right direction. But it must be properly implemented if it is to achieve the desired results.
Launched in 2011 and incorporated in 2013 by the CBN, the Bankers Committee and the Federal Ministry of Agriculture and Rural Development, NISRAL is the Nigeria Incentive-Based Risk Sharing System for Agricultural Lending. It de-risks the agriculture value chain, and enables banks to lend to the sector at rates of between 7.5 and 10.5 per cent.
Recognising that the CBN had in the past established numerous programmes to support the MSMEs but with very little to show for such efforts, the new measures should be practical and tailored to the needs of the MSMEs. Fortunately, what they need to survive, progress and deliver to the economy is not hidden. There are also lessons from past experiences to draw from.