Nigeria trails behind South Africa, Egypt, Ghana in credit records rating

Nigeria is listed as one of the African countries with the poorest rating in credit discharge records, with South Africa leading the pack of countries in the contentment that have impressive records.

The 22 commercial banks Nigeria, have only about 1,500 credit records daily, while South Africa with about 15 banks is running 60,000 credit records daily.

Egypt has 50,000, followed by Ghana with 45,000 of the records.

Disclosing this in Lagos at the weekend, during a one-day seminar organised by Nigerian Credit Bureau, Mr. Miguel Llenas, the CEO, Dun and Bradstreet Credit Bureau Limited, a world acclaimed credit reporting agency, says Nigeria needs to carry out more reforms to improve its financial system as the key agency of growth of any economy.

Llenas, stated that the Dominican Republican-based agency had been monitoring developments in Nigeria, as regards viability or otherwise of the banking system and has reached a conclusion that the country is yet to maximise its potential in discharging credit for more investors to come into its economy.

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“Going by the realities on the ground, it is true concluding that most banks in Nigeria are technically in distress because they prefer venturing into non-core banking services.

“This has seen most businesses in the country experiencing stagnant growth because they lack access to finance from banks.

The banking sector can only grow the economies in its operational environment, if it can support startups and medium sized firms, as against running to big companies to extend credits to, with funds that could lift many more enterprises, he said.

Citing instances with other developing countries, including Argentina and Sri Lanka, whose credit records have more than doubled in the past five years. He said they achieved impresive return on finance management, which has seen their credit records improve.

According to the agency boss, Argentina jumped from a figure of about 80,000 to 160, 000 in its credit records, while Sri Lanka, which was reporting a little over 25, 000 jumped to 50,000 within the period under review.

“Most Nigerian banks are not involved in serious lending, especially to the retail market. They have shifted from lending in order to survive and that is partly why the economy is not moving forward,” Llenas maintained.

On the effect of toxic debts on the system, he states that most deposit money banks in the country today are yet to find the solution to it as against facing the issue squarely rather than trying to smart from the losses.

He added that if well organised, with credit monitoring teams, credit banks and lenders alike, it will be easier to predict the future of every economy.

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