FG is set to roll out single-digit interest loans for SME's by 2025
FinanceSME Resources

FG is set to roll out single-digit interest loans for SME’s by 2025

The Federal Government has announced plans to offer loans at a single-digit interest rate for Small and Medium Enterprises (SMEs), beginning in the third quarter of 2025. This initiative aims to support the growth of Nigeria’s SME sector and reduce financial barriers for small business owners.

Temitola Adekunle-Johnson, Senior Special Assistant on job creation and MSMEs, made the announcement during a Nationwide Townhall and Sensitization Programme on the Presidential Grant and Loan Scheme for MSMEs in Abuja. He emphasized that the government’s focus on SMEs is crucial, as these businesses provide over 80% of employment in Nigeria and contribute nearly half of the national GDP.

Addressing Barriers to Financing

Access to affordable loans has been a persistent issue for Nigerian SMEs, compounded by high interest rates and collateral requirements. The Central Bank of Nigeria’s monetary policy has driven rates up, with the most recent hike raising the Monetary Policy Rate to 27.25%, making loan repayment a significant challenge for small businesses.

However, the Federal Government’s new initiative aims to address these obstacles. Adekunle-Johnson highlighted that the administration, in partnership with major financial institutions like Access Bank, Wema Bank, and the Bank of Industry, will begin offering single-digit interest loans to SMEs across all states by late 2025.

“Currently, 18 state governments have expressed interest in joining this partnership, which means that small business owners nationwide will soon be able to access low-interest loans with minimal barriers,” he said. He added that the initiative intends to create an environment where small business owners can confidently secure financing, scale their operations, and repay loans with manageable terms.

Government Support for Economic Growth and MSME Development

The Minister of Information and National Orientation, Mohammed Idris, reaffirmed the administration’s commitment to promoting economic reform through targeted support for small businesses. Idris noted that while the government’s economic policies have been challenging, the single-digit loan program, alongside tax reform measures, is designed to relieve some of these pressures for Nigerian businesses.

Additionally, the minister highlighted ongoing interventions, such as the N200 billion loan fund and a one-off conditional grant of N50 billion aimed at nano-businesses. These funds, alongside a forthcoming N75 billion phase for SMEs and another N75 billion for large-scale manufacturers, underscore the government’s commitment to alleviating the financial burdens on Nigerian entrepreneurs.

Under the Tinubu Social Intervention Programmes, business owners can access these supports by simply submitting applications without needing any political connections. The government is also holding town hall meetings across Nigeria’s six geopolitical zones to gauge SME feedback and ensure that the interventions are effectively tailored to meet their needs.

Finally

By making single-digit interest loans available, the Federal Government aims to foster a more supportive financial environment for SMEs. Through partnerships with banks and state governments, this program seeks to empower Nigeria’s small business owners, enabling them to expand their operations and contribute to a sustainable economy.

Related posts

Changing Financial Mistakes into Opportunities for Success

Novelsunrise

DBN, Grand Africa to empower 350 women

Novelsunrise

MSME launches Digital academy

Novelsunrise

United Bank for Africa Named Most Visited Banking Website in Nigeria

Novelsunrise

MSME starts an online academy

Novelsunrise

Kuda Launches Virtual and Physical PoS Solutions to Support African SMEs

Novelsunrise

This website uses cookies to improve your experience. We'll assume you're ok with this, but you can opt-out if you wish. Accept Read More

Privacy & Cookies Policy