Osinbajo signs new laws for SMEs to access loans

By Abdullahi M. Gulloma Abuja

Acting President Yemi Osinbajo has signed into law two bills from the National Assembly that would facilitate access to more aff ordable credit for Nigerians. Th e bills which have now become Acts are the Secured Transactions in Movable Assets Act, 2017 (otherwise known as Collateral Registry Act) and the Credit Reporting Act, 2017. Th is was contained in a statement issued by the Senior Special Assistant to the President on Media and Publicity in the Offi ce of the Vice President, Mr. Laolu Akande. According to the statement, the passage of the Acts would facilitate the achievement of the goals of the Presidential Enabling Business Environment Council (PEBEC) set up by President Muhammadu Buhari in July 2016.

“Th e Collateral Registry Act’ ensures that Micro, Small and Medium Enterprises (MSMEs) in Nigeria can register their movable assets such as motor vehicles, equipment and accounts receivable in the National Collateral Registry, and use same as collateral for accessing loans. Th is in turn will increase their chances at accessing fi nancing and tackle one of the major obstacles faced by MSMEs. “On the other hand, ‘Th e Credit Reporting Act’ provides for credit information sharing between Credit Bureaus and lenders (such as banks), as well as other institutions that provide services on credit such as telecommunication companies and retailers. (A Credit Bureau is defi ned as a company that collects information relating to the credit ratings of individuals and makes it available to fi nancial institutions, who need such information to determine an individual’s credit-worthiness and whether or not to grant loan applications to such individuals”, the statement added. In a related development, the federal government said it has come up with a N100 billion Family Home Fund under its social housing project that provides inexpensive mortgages to Nigerians who can aff ord N30,000 per month, Acting President Yemi Osinbajo, has said. Osinbajo, who disclosed this while presenting the Social Investment Programme score card as part of activities to mark the 2017 Democracy Day celebration, said already the project has started in 11 states. “Th ere is also an aspect of the SIP that has not been mentioned. Th is is N100 billion set aside for the Family Home Fund of our Social Housing Project,” he said. Explaining the operationalisation of the fund, Osinbajo said the “N100billion is a yearly contribution to our N1trillion Social Housing Fund, the largest in the history of the country. “Both the World Bank and AFDB are contributors to the fund from which developers will borrow 80 per cent of cost of project and counter fund with their own 20 per cent. “Th e same fund will enable us to provide inexpensive mortgages for hundreds of thousands across the country especially for Nigerians who can aff ord N30, 000 per month. “We expect that this Family Housing Fund will jumpstart and expand construction exponentially across the country,” he said. He said some of the houses are estimated to cost as low as N2.5 million, which would be paid for through the monthly mortgages. “Th e 2017 budget provides for substantial investment to implement our Social Housing Programme. Th e Family Home Fund of our Social Housing Programme will provide inexpensive mortgages for low-income individuals and families across the country,” he said.

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