Naira Scarcity Forces 25m MSMEs To Shut Down – ASBON

The protracted and prolonged naira scarcity forced about 25 million Micro, Small and Medium Enterprises (MSMEs) to either shut down completely or scale down their businesses drastically even to the point of becoming inactive, the Association of Small Business Owners of Nigeria (ASBON), has revealed.

The national president ASBON, Dr. Femi Egbesola, while speaking on the development, said, the protracted and prolonged Naira scarcity plummeted the ease of doing business ranking in the country as a large number of unbanked Small and Medium Enterprises (SMEs) fell into a large swoop of redundancy.

He added that, financial literacy was crucial to closing Nigeria’s financial exclusion gap on the informal sector and unbanked SMEs in the country while maintaining that the failures of the SMEs to adopt financial literacy and digital banking platforms interrupted businesses and forced a lot of SMEs to run out of ideas, thereby creating more redundancy and labour lost.

According to him, about 60 per cent of 40 million MSMEs fell into a large swoop of redundancy and labour lost during the peak of the cashless monetary policy implemented by the Central Bank of Nigeria (CBN), which resulted to about 25 million MSMEs forced into a total decline of activity and business closure.

He bemoaned that the ease of doing business ranking has dropped to an all-time low because of the government policy which he said was killing businesses and hemorrhaging the economy.

He, however, urged the government to improve the statistics of ease of doing business in the country by appointing round pegs into round holes to manage the affairs of the MSMEs ecospace, believing that SMEs are drivers of growth in the economy and the federal government must pay crucial attention to them.

The ASBON boss said, for SMEs to enhance recovery, there was the need for proper restructuring of business models, adding that, this would ensure that all businesses are properly captured and well included into the financial literacy ecospace.

He affirmed that financial literacy was crucial to closing Nigeria’s financial exclusion gap on the informal sector and unbanked SMEs in the country.

On the business side, he said, the Business Management Organisations (BMOs) must take pride to educate the financially excluded and the unbanked SMEs by letting them know the importance of bringing them on board into the financial ecospace.

He charged the BMOs and corporate organisations to educate the SMEs on financial literacy programmes by organising seminars and symposia to formally train them on the need to embrace digital banking and online transactions.

“The SMEs needs to evolve from traditional ways of cash systems to new ways of digital banking and online transactions and by so doing this would handhold the SMEs to be on fast track to implement digital banking to help manage their bills and transactions,” he said.

Egbesola suggested that government should join collaborative efforts with SMEs stakeholders to make and implement policy that would promote the ease of doing business, noting that, SMEs are engine of growth, and they must be recognised through paying adequate attention to their plight.