How Inflation Cripples FG Fiscal Interventions In MSMEs – DBN
· Why Nigerian career women suffer depression
Despite several efforts by the Federal Government to guarantee Micro, Small and Medium-sized Enterprises (MSMEs) access to loans, fiscal experts have posited that the growing inflation rate in Nigeria is the major impediment to government’s monetary interventions across various sectors of the economy.
With Nigeria’s annual inflation rate at 11.37%, it would be unsustainable to disburse MSME loans below this rate despite funding by the Federal Government. However, small business owners in America can obtain loans from traditional lenders such as banks or credit unions, with annual percentage rates (APRs) ranging from 4% to 13% as its annual inflation rate is at 1.9%.
The Managing Director of Development Bank of Nigeria (DBN), Mr. Tony Okpanachi revealed this monetary problem at the 3rd Women In Leadership and Career Empowerment Programme (WILCEP) Africa mentorship masterclass with the theme; “Building Lasting Business with Credits and Grants in Challenging Times” organized by MMS WoFHoF Initiative in Lagos, last week.
Explaining how DBN operates, Okpanachi who was represented by the Business Development and Relationship Manager, Maryesther Ezeadi said; “We are set up to lend to commercial banks, microfinance banks and other licensed financial institutions who now lend to the MSME end-borrowers”
She stressed that business owners must have a stake in their businesses, adding that investments are never funded with 100% debt particularly MSME businesses whose margins are usually within 20% range. The business must stake its equity for maximum return.
“The key distinguishing feature is that we provide longer tenor funds up to 10 years with an 18 months moratorium. I know what some of you might be thinking, and that is, why don’t you lend directly? The rationale is clear, we are a wholesale bank and we don’t lend directly to end-borrowers. The commercial and microfinance banks are already established with closer ties to you, the customers. Presently, we have partnered with over 25 financial institutions listed on our websites. These include Commercial Banks and Microfinance banks” she stated.
According to her, at the end of 2018, DBN disbursed over N31bn and reached 35,000 businesses. She noted that the Bank had taken deliberate steps in ensuring female entrepreneurs are empowered through available financing with over N7 billion (24% of total amount disbursed) in loans disbursed to female MSMEs, accounting for over 73% of the total loans granted in 2018.
“In 2018, DBN loans were disbursed to female entrepreneurs from across 17 sectors with the top 4 sectors being; Trade and Commerce (49%) Manufacturing (16.3%), Accommodation and food services (10%) and Agriculture (9%)” she added.
Meanwhile, she lamented that most Nigerians have viable businesses and the expertise, but they lacked financial literacy. She revealed that DBN has just concluded plans to train 100 MSMEs at the Lagos Business School.
“They can’t do basic book keeping, stock taking. How do they get a repository of information? How would they go about their taxes? How do they get incorporated and get the requisite certifications? These are some of the issues we intend to address with the training. The programme will help address the Entrepreneurship and Business Management skill gaps of Nigerian MSMEs” she said.
Also speaking at the event, the Public Relations Officer of Apapa Customs Command, Nkeiru Nwala lamented that Nigerian career women suffer gross depression in the bid to balance their responsibilities as wives, mothers and career persons.
Nwala noted that career women in the country have become victims of offensive comments, suffer threats of sexual assaults, unwanted sexual favours and other gender-based insulting comments.
However, she advised women to recognize their distinct roles at the home and at the office and strive to create a balance in order to live a happy and peaceful life.
While speaking on the topic “Tackling Depression among Career and Business Women in Nigeria Today”, she urged business women to be happy despite numerous challenges in the country.
She also advised them to seek psychiatric counsel when they feel they are burdened by challenges, noting that speaking out would lessen the burden and help them find solutions instead of bottling up which leads to depression.
“A woman is saddled with this burden of managing her career, being a mother, wife and all that she must be; hence she has to take responsibility for her life. She must stay focused, be confident and take care of her health. She must stay positive and always say to herself, “Yes, I Can do all these together”. Depression, death or being a house-wife isn’t an option” Nwala said.
In her presentation, Co-Director, Al-Hadiat Nigeria Limited, Mrs. Folake Soji-George urged women to embrace perseverance and hard work as key business attributes that guarantee lasting businesses.
“You have to do your due diligence. You have to put your all into what you are doing and pray as well. In the period of your humble beginning, you might get discouraged when challenges come. But one thing we must be sure of is that as the problems come, solutions will also come. This is because you have made up your mind about what you want to do and that you enjoy doing it”
“Nothing good comes easy, but with God, passion and perseverance, you will succeed. You can start small, build your business and over time it will yield results. You don’t need to start big, when you start small, you’ll be able to gather experience and learn from it” she said.
Folake also enjoined women to present themselves modestly in the society and gather experience in order to stand out and be respected; even as she admonished them to always seek personal development.
“You need to get experience, go for trainings and workshops. Without education, people won’t respect you. Even if you have money and you don’t know how to present yourself, they will push you aside. You have to equip yourself with the right knowledge and be able to present yourself intellectually. If the cloth you have is just two naira, you should iron it well and look good so that when you speak, people want to listen” she opined.
According to her, lasting business can only be created by starting small while learning from the challenges that comes with the business.
“With no truck at the initial stage, my company, Al-Hadiat now has twenty-two trucks; we also have our garage and our drivers. We invite Lagos State Traffic Management Authority (LASTMA)and Federal Road Safety Corps (FRSC) to train the drivers and talk to them periodically about the job that they have taken” she said.
Meanwhile, the Group Head, Human Resources at SIFAX Group, Mr. Oluwakayode Alonge admonished Nigerian women to prioritize their lives and their wellbeing.
The SIFAX boss lamented that Nigerian women have unknowingly placed more value on the lives of their husbands, children, siblings and other relations more than theirs.
Alonge had asked the women to write down the five most important people in their lives and only one participant, Ms. Marvellous Chukwunyem had written down her name as one of the most important persons in her life.
Alonge who instantly awarded Marvellous N5000 for her action, lamented that the exercise showed that Nigerian women hardly prioritize their lives as they choose to care altruistically for those around them.
Earlier, the Assistant General Manager (AGM), Kings Communications Limited, Mrs. Ifeoma Iloh explained that MMS WoFHoF Initiative is a registered non-profit organisation founded with the aim of empowering women in the society through various means which include, discovering and celebrating the sterling qualities and contributions of a select women in Africa for impact on the younger generation and their environment.
She noted that MMS WoFHoF Initiative was bent on empowering and training the next generation of women leaders in the maritime, oil and gas, finance, aviation as well as political leadership sectors.
“With the aim of helping to grow businesses, MMS WOFHOF has introduced a social empowerment scheme which gives grants and access to micro credit facilities to 250,000 micro business owners, especially women in five years – 2019/2024, hence this initiative is code-named: Vision 5W-250,000 project” she said.
According to her, the Initiative had started empowering women with quick cash to start-up or boost their businesses and the programme intends to touch the lives of 50,000 women annually to reach 250,000 in five years.
The Programme Officer, Mrs. Comfort Chisom, had assured the participants that they were set for a career/ business transforming mentorship class and the account of the participants gives credence to that assertion.
One of the participants, Mrs. Patricia Edeha told MMS Plus, “I have learnt to be consistent in whatever I venture into. Mrs. Folake Soji-George gave an inspiring talk about how she started and today she is a huge success and a force to reckon with in the truck haulage business. I was able to understand the importance of being passionate and persistent because that was what she applied in her business and she emerged successful. I would apply these characteristics as I go about my business”
“I know that running a business successfully isn’t easy especially with the hostile environment in Nigeria, but after listening to Mrs. Folake I have a strong will. The sessions rekindled the fire in me. I’m also better prepared to try other methods that they were able to apply to their businesses to be successful” she said.
Another participant, Ms. Anthonia Jukpor had this to say, “I’m planning to start Jukkies Collection soon. In starting up a business, one tends to only think about the cost but this conference has helped me think beyond the cost. I have learnt that passion can move you to be more resilient in business. I have also learnt how to save. There is nothing too little to save and as women it is important to curtail the way we spend”
“When Mrs. Folake was talking, I could see the passion in her because she was doing what she loved. She also taught us about the need to improve ourselves and not be comfortable in a particular position. We should move with the flow in terms of technological advancement and stop being idle, rigid and complacent” she added.