The Nigerian Consumer Credit Corporation (CrediCorp) and the National Automotive Design and Development Council (NADDC) have unveiled a N20 billion consumer credit fund to enable Nigerians to purchase locally-assembled vehicles.
The initiative, which was unveiled on Thursday in Abuja, was aimed at stimulating the Nigerian economy by increasing credit-based purchases in the country.
To kickoff the initiative, a Memorandum of Understanding (MoU) was signed between CrediCorp, NADDC and members of the Nigerian Automotive Manufacturers Association (NAMA) to fine-tune the processes for the vehicle purchase loan scheme.
Speaking during a signing event, managing director/CEO, CrediCorp, Uzoma Nwagba, said the initiative empowers Nigerians with credit to own new automobiles (cars, tricycles, motorbikes) while growing Nigeria’s automotive industry.
Nwagba, while emphasising that no country can develop if the credit system is not working, said the scheme which is beginning in earnest early next year, was targeting single digit interest rate ultimately.
According to him, CrediCorp will provide credit guarantees to the vehicle manufacturers with locally-assembled components to facilitate the purchase of vehicles by consumers.
He noted that while the N20 billion may be considered small, it is only for the start and it was meant to test the process.
“A big bet here is that we will have an opportunity to test this and catalyze it. So, now don’t worry about the headline number of N20billion, because that’s not actually a lot of money.
“If this test works, if we are able to enable people to get vehicles, if we are able to track the impact against other industries, and jobs that we create through this, it will create the confidence for more money to come in,” he said.
Nwagba explained that the Corporation was targeting a single-digit interest rate to enable Nigerians to purchase these vehicles, particularly the people who have very strong credits and who show a good credit history.
“The fund that we are launching today is just a start. It’s a start to show a commitment to this industry; it’s a start to show the commitment of the President, and it’s a start to actually catalyze credits and allow people to access and get out of transport poverty,” he stated.
Director general of NADDC, Dr. Joseph Osanipin, on his part, noted that the consumer credit scheme to be implemented by CrediCorp, was part of President Bola Tinubu’s agenda to stimulate the economy.
According to him, the provision of the consumer credit fund for locally-assembled automobiles would boost and increase the demand for auto products in the country.
Osanipin highlighted the importance of increasing the demand for auto products, saying auto products cut across all sectors of the industry.
“When you promote auto, you are promoting the steel industry, you are promoting the plastic industry, and you are generating a lot of employment. You are also promoting the energy sector, and that’s why it is very important.
“Our people, the citizens, want to buy vehicles, but it’s very difficult nowadays for you to save enough to buy a new vehicle. When I say vehicle, I’m talking about a motorcycle, tricycles, and vehicles—everything that we use for mobility.
“We need credit schemes to work; that’s the way it operates all over the world. You don’t see people who would need to save up to 20 million, or 30 million before they ride a vehicle or when they want to use a vehicle for mobility.
“When you access the credit and use it to do your job. As you are doing your job, you are paying back, and you are contributing to the economy,” he stated.
He added that the CREDICORP team would enlighten people on the process, the criteria, the guidelines, and what everyone needs to do to be enlisted as part of the beneficiaries.
“We have the assemblers here, but we know this credit is going to be given to the consumer. But the assemblers are the ones that will supply the product that consumers are going to buy. So we need to first of all get them ready so that they can start the production, and then whatever they are producing, they will have the consumer in mind.
“Because if the consumers are not happy with their products, they are not going to accept the credit for that product. So it’s competitive; the customers have a choice to make here, and they have to decide which product they are buying. But what we are saying is that the product must be Nigerian-made vehicles.
“We are happy that CREDICORP is dedicating as much as 20 billion Naira into this industry, auto sector for this. We say thank Mr President, for approving the scheme,” he stated.
On his part, president of Nigerian Automotive Manufacturers Association (NAMA), Bawo Omagbitse, commended CREDICORP for the bold initiative, saying the scheme is a catalyst for great things to come into the industry.
He noted that the auto industry itself requires transformation because it is currently “suffocating”.
CREDICORP said the automotive industry is one of the five key focus areas under its project S.C.A.L.E (securing consumer access for local enterprises).
On November 18, CrediCorp announced the launch of project S.C.A.L.E to boost the growth of local industries.
The corporation said the initiative seeks to channel consumer credit to the purchase of goods and services from local vendors and manufacturers.
