According to the Small and Medium Enterprises Development Agency of Nigeria (SMEDAN) the number of MSMEs in Nigeria is at 37 million, employing 59 million persons who contribute over 70 per cent of the active labour force. That means that over a quarter of our population is involved in small and medium scale businesses. And they are mostly artisans, petty traders and the likes.
Of this large number, 43 per cent fail due to lack of funds for daily sustenance or consistent sales and 38 per cent do not grow beyond their initial start-up level.
A major challenge of these businesses is that they cannot meet the basic requirement of obtaining loans at commercial banks, and even when they do, they do not possess sufficient collateral for these loans.
Research shows that the availability of microcredit facilities is one key step to boosting economies of developing countries like Nigeria. Yet, this has not been the case, as credit facilities have, in most instances, been channeled to the high and mighty businesses.
Nigeria’s vice president, Yemi Osibajo, is often heard saying that one of the objectives of his administration is to invest in the lives of its people, especially those at the bottom of the pyramid. The visible and rigorous efforts of the initiatives of the National Social Investment Programmes, is telling of this intent.
The Government Enterprise and Empowerment Programme (GEEP) is one of the schemes of the Social Investment Programmes. Through its sub-schemes, TraderMoni and MarketMoni, financial support is provided through micro lending to micro scale traders. These schemes seek to promote financial inclusion at the grassroots, assisting petty traders with the financial support to conduct their respective businesses.
They serve a dual purpose: an economic intervention to drive economic advancement at the grassroots, as well as a social impact project. The implication of this is that these schemes are set to improve the nation’s economy by first improving the daily living conditions of its beneficiaries.
Two commonplace errors I have often come across when conversations on Trader Moni come about: one, the notion that N10,000 can barely make an impact in a person’s life, let alone a household or a business and secondly, the possibility of the scheme to have significant impact on a national or global scale, especially in the long term.
These notions demonstrate that the divide between Nigeria’s poor and rich is palpable; that while to some, a loan of N10,000 may seem a paltry sum and even useless, to a large number – a silent majority – it may seem synonymous with oxygen. The imbalance in the conversation flows from the fact that those who control the spaces of conversations, those who write history and shape narratives, are the elite minority who cannot fathom the logic of the impact of N10,000 to a small business. To them, this money would function to simply cater for petrol or recharge card.
The beneficiaries of the scheme mostly do not have a voice. They are not on social media. They do not have smart phones to explain their stories – and even when they do, they are not literate enough to tell it.
They are not invited to television stations to comment on the effects of these loans – their best chances at having their voices heard is when the vice president takes a tour to assess the programme in markets.
They cannot write opinion pieces on newspapers or blogs. Yet these are the men and women who form the majority – the silent majority.
Whether they have a voice or not, it does not take away their reality. Take for instance, Mrs Agbo Mnenna Mercy, who heartily shared her growth story of selling basins of corn to trading in bags; to Mrs Anyor Doshima, a petty trader in Wurunkum market, Benue State, who, through TraderMoni, was able to make an increase in the number of livestock she owned from 50 to 70; to Solomon Ogunwale, a trader in Oja Oba Market, Oyo State, who has expanded his blending business and has now employed a new staff.
These seemingly little changes in their businesses have culminated in increase in their purchasing power as well as improvement in their living standards, and even nutrition. The enormity of Nigerians in this economic demography is one of the reasons why it is detrimental for this vast number to remain underfunded or unassisted. The scheme addresses a pertinent challenge of citizens in this demography; accessing capital without the added pain of high interest rates and rigid collateral demands which before now, prevented them from expanding their businesses and employing more labour. The ripple
effect of the seemingly little, stretches as far as improving productivity among the disadvantaged population, decrease in inequality as more women are empowered financially, and the improvement in living standards triggering more economic activities across the nation. It was Confucius who said that he who intends to move a mountain must first start by carrying little stones.
The little impact of each loan given to a family, adds to the greater impact that Nigeria needs to end poverty, no matter how slowly. With the loans disbursed so far, this lifeline has done more for the economy than many can ever fathom.
James, the president of the Initiative to Save Democracy, writes from Abuja.
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