We’re Creating More Funding Facilities For SMEs In Enugu State — Hon Arinze Chilo Offiah on Sunshinetruthng
In Nigeria, it has been proven that Small and Medium Enterprises (SMEs) contribute 48% of national GDP, and account for 96% of businesses and 84% of employment, yet research shows that most SMEs fail within the first five years of their existence.
This simply means that every five years, numerous businesses are closed, people are left unemployed and in critical situations, people lose their source of income and livelihood. As seen in most cases, the crippling of these SMEs are as a result of financial constraint.
Financial challenges for SMEs can come up in different ways. From lack of capital to expand, to lack of cash flow to keep the business afloat amongst other challenges, result in financial hiccups that cripple SMEs faster than market trends.
The issue, however, is not just about the source of funds but also the easy accessibility to long and short term loans. In terms of negotiating for loans, lack of collateral, high-interest rates, and the cost of accessing these loans dissuade small business owners from seeking financial aid.
To counter these challenges in Enugu State, the Special Adviser to the Governor, His Excellency Rt. Hon. Ifeanyi Ugwuanyi on SME matters and Head, Enugu SME Center, Hon. Arinze Chilo-Offiah has been able to oversee a system that gives financial support to SMEs and encourages them to grow.
He has innovatively initiated a financial scheme that grants loans to SMEs conveniently, without having to cost an arm and leg. “Running a small business is already a demanding process, and the additional responsibility of sourcing for finance would make it stressful instead of inspiring.
This is the reason these funding facilities were created. I believe every SME should have a shot at thriving, without money standing in the way,” says Hon. Chilo-Offiah.
Hon. Chilo-Offiah formed partnerships with firms such as Lidya, a private sector fintech to create a scheme called “Enugu SME Business Support Cash Advance”, where SMEs in Enugu State can access loans. Since its inception in July 2020, over 300 SMEs have accessed no higher than N250,000 (two hundred and fifty thousand naira) each and over N40,000,000 (forty million naira) disbursed.
Furthermore, Hon. Arinze Chilo-Offiah has through his platform, partnered with Fidelity Bank Plc. Shoprite branches on the “Enugu Micro-Credit Lending Program” to also fund business owners operating in Enugu State.
Applicants, including the physically challenged, from all economically viable business sectors can acquire up to N300,000(Three Hundred Thousand Naira Only) loan under a business, or as an individual, if the business is not registered.
To further enhance the loan flexibility and cushion financial pressures on SMEs, Hon Arinze Chilo-Offiah included in the schemes a one-month moratorium for small business owners in the loan negotiation. It is also worthy to note that the free loan schemes are completely digital schemes with easy steps that can be accessed from the comfort of one’s home, without fear of favour.
This way, he ensures that small businesses can grow, and business owners receive enough funds to run their businesses.
These schemes, amongst many others, have positioned Enugu State globally, pushing the state from being unnoticed in the global market to stand as the 5th top Startup Ecosystem in Nigeria.
The idea is to revolutionize small businesses in Enugu State and ensure that they grow maximally, as well as contribute to the economy of the state, and society at large.
Article Link: https://www.sunshinetruthng.com/were-creating-more-funding-facilities-for-smes-in-enugu-state-hon-arinze-chilo-offiah/
