The Director-General of Small and Medium Enterprises Development Agency of Nigeria (SMEDAN), Umar Radda, has accused state governments of frustrating efforts to create more wealth for citizens, through Small and Medium-Scale Enterprises (SMEs).
Radda stated this on Monday while defending the agency’s 2021 budget proposal before the House of Representatives Committee on Poverty Alleviation.
According to him, about 40 million businesses in Nigeria, representing 96 per cent, were not formalised enterprises.
He said that efforts to create more wealth for citizens through SMEs had not been working very well because some state governments “are not showing any interest, while others would say they do not have such arrangements in their budgets.”
He told the Reps committee that with the new Central Bank of Nigeria’s (CBN’s) share capital requirement, N200 million would be the minimum start-up capital for a microfinance bank, starting from 2022.
Noting that the SMEDAN’s microfinance bank for SMEs was ready with the establishment of a branch in Abuja on a pilot scheme, Radda regretted that of the N1.3 billion mapped out for the pilot project in Abuja last year only N40 million was released.
There are perceptions that SMEDAN and the Federal Ministry of Humanitarian Affairs’ Conditional Cash Transfer Scheme are duplication of roles.
But Radda disagreed. He said they were doing different things, explaining that “SMEDAN is a conditional cash grant specifically targeted as motivation to help SMEs formalisation processes” as well as capacity building for owners.
“The N50,000 Conditional Cash Grant Scheme is a form of motivation for SMEs. From the grant, we assist them to register their businesses with the CAC, create a microinsurance cover for one year for their businesses, and we also train them, including on how to keep records of their businesses,” he said.
After the session, the Reps committee chairman, Abdulahi Salami said, “This is teamwork. We have to work together to alleviate the suffering of our people.”
He assured that the committee would study the budget and do justice to it in a manner that it would be for the good of Nigerians.
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