The Director- General of the Small and Medium Enterprises Development Agency of Nigeria (SMEDAN), Dr Dikko Umaru Radda has stated the Federal Government is determined to use ratings to galvanise Micro, Small and Medium Enterprises (MSMEs) and revamp Nigeria’s economy.
Radda who disclosed in Yenagoa, Bayelsa State capital over the weekend at the stakeholders sensitization programme of the proposed Small and Medium Enterprises Rating Agency (SMERAN) said the establishment of the agency would ease access of funds for businesses in Nigeria.
“A majority of the MSMEs are operating as informal entities and not do not have the capacity to maintain minimum corporate governance standards. As a result, most of fund providers do not feel confident extending loans to enterprises whose track records are neither known to them nor easily verifiable. Such businesses are therefore perceived to have higher probability of credit default and actually default in most cases. This contributes largely to the inability of MSMEs to access affordable credit. The establishment of SMERAN is intended to reduce the turnaround time in MSMEs access to funds and other critical resources.”
Radda while commending the roles of the Bank of Industry and NEXIM Bank in achieving the desired result of SMERAN said aside offering rating services information and advisory services, SMERAN would also help to enhance MSMEs business credibility and corporate governance.
SMEDAN, Zonal coordinator, South- South, Omubo-Pepple Anyam Linda in her remarks said SMERAN is the game changer for the development of MSMEs to expand Nigeria’s economy.
She encouraged every business owner to take advantage of the on-going mass registration of MSMEs to position their businesses to access credits.
Her words “This is a stakeholder’s programme on the proposed establishment of SMERAN. The government has realised that Nigeria has come to a stage where it needs a rating agency. A rating agency specifically rates activities of MSMEs in order to rate them to for access to funds to build their businesses.
The challenge most MSMEs face in this country and elsewhere is access to financial resources because whoever wants to give the funds is not confident in doing so. However, if there is rating agency independent of the MSMEs that can give global rating which can be used to access funds anywhere in the work.
The programme to is acquaint stakeholders at this state of the intention of the federal government through SMEDAN, BOI and NEXIM bank. This is to be followed by a mass registration of MSMEs to enable Nigeria have a database. Everybody is encouraged to register business and get the requirement to be able to access funds.”