Nigeria’s credit market is set for a major transformation as the National Credit Guarantee Company Limited (NCGC) prepares to commence operations with an initial capital of ₦100 billion, aiming to unlock sustainable financing for underserved sectors, including Micro, Small, and Medium Enterprises (MSMEs).
Speaking at the Stakeholders’ Engagement on the Take-off of NCGC, the Managing Director/CEO, Bonaventure Okhaimo, said the company was established to address one of the biggest hurdles in Nigeria’s credit market — lenders’ reluctance to extend credit due to high risk.
“We do not lend directly; rather, we provide partial credit guarantees, covering a portion of potential loan defaults,” Okhaimo explained. “This innovative approach incentivises financial institutions to extend more credit, confident in the knowledge that part of the risk is borne by the NCGC.”
With Nigeria’s MSMEs accounting for over 90% of businesses but facing persistent credit constraints, the NCGC will act as a loan guarantor, enabling banks and other financial institutions to lend more confidently.
The guarantees will reduce the perceived risk of lending, encourage financial institutions to expand their credit portfolios, and enhance financial inclusion.
By lowering default risks and improving credit flow, NCGC is expected to drive job creation, stimulate industrialization, and support inclusive economic growth.
Okhaimo emphasized that the NCGC will leverage data, technology, industry partnerships, and capacity-building initiatives to ensure smooth operations and reduce default risks. Public sensitization and advocacy for credit-friendly policies will also form part of the company’s strategy.
Delivering a keynote paper, Dr. ‘Biodun Adedipe, founder of B. Adedipe Associates Limited, hailed the NCGC as a long-awaited solution to Nigeria’s systemic credit challenges.
“NCGC is the missing link that can drive inclusive growth and deepen industrial manufacturing,” Adedipe noted. “Its biggest risks are moral hazard and political interference, but with its defined structure and strong leadership, it can operate profitably and sustainably.”
He stressed that credit guarantees are essential in bridging the gap where lending opportunities exist but borrowers lack sufficient collateral or fallback options.
For decades, high-risk perception has limited access to credit for Nigeria’s MSMEs, stalling expansion and innovation. With the NCGC now in place, financial institutions have a safety net, and MSMEs may finally get the affordable credit needed to scale.
If implemented effectively, this initiative could reshape Nigeria’s credit landscape, reduce reliance on informal lending, and accelerate the country’s journey to inclusive economic growth.
