Banks’ double-digit interest rates stifling small businesses — SMEDAN

The Small and Medium Enterprise Development Agency of Nigeria (SMEDAN) has said commercial banks are stifling Micro, Small and Medium Enterprises (MESMEs) by lending them funds at double-digit interest rates.

The Director-General of SMEDAN, Dikko Umaru Radda said this in Abuja on Thursday.

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“The interest rate of the conventional banks is unbearable because it is over 20 per cent,” he said.

Radda said this informed the establishment of a mutual fund between his agency and the Bank of Agriculture to lend funds to small businesses in single-digit rates.

He said SMEDAN has also started making moves to set up a micro finance bank to lend funds to MSMEs at cheaper interest rates.

“This is bearing in mind the fact that one of the major challenges of MSMEs is funding and most of the requirement provided by the commercial and even development banks in Nigeria are very high for the MSME to achieve,” he said.