Stakeholders have described National Credit Guarantee Company (NCGC) as a company on rescue mission to salvage the lack of access to credit in the Nigerian Economy, especially small and medium enterprises. At a stakeholders meeting participants said it is a timely and long-awaited institutional intervention in the Nigerian credit market. In his address at the event, Bonaventure Okhaimo, MD/CEO, National Credit Guarantee Company said that President Bola Ahmed Tinubu visionary leadership led to the establishment of the National Credit Guarantee Company (NCGC). He said “by providing this much-needed safety net, we aim to expand access to finance to MSMEs, local manufacturers and credit consumers; thereby minimizing the risk exposure of Participating Financial Institutions (PFIs), lowering default rates, and ultimately driving economic growth and promoting financial inclusion”.
He said “our success hinges on inclusive partnerships and collaboration with all stakeholders in the financial ecosystem. We firmly believe that by working together, we can build a more inclusive, resilient, and dynamic credit market in Nigeria. To achieve this, we will partner with PFIs, leverage data and technology, engage industry groups, build capacity, raise public awareness, and advocate for enabling credit policies,”. This bold initiative reflects the administration’s strong commitment to de-risking lending, promoting financial inclusion, and improving access to credit for Micro, Small and Medium enterprises (MSMEs), local manufacturers and credit consumers across Nigeria.
“Nigeria’s macroeconomic outlook reflects a steady trajectory toward inclusive and sustainable growth, driven by gradual reforms and sectoral diversification. Recent data from the National Bureau of Statistics (NBS) shows a commendable Gross Domestic Product (GDP) growth of 3.13 percent in first-quarter (Q1) 2025 after rebasing, a significant improvement from the previous quarters. This growth was supported by strong performance in the services and non-oil sectors, indicating the economy’s growing resilience amid inflationary pressures, rising interest rates, volatile exchange rates, and elevated energy costs that have significantly eroded the purchasing power of consumers and increased operating expenses for MSMEs, and local manufacturers,” he said. He further said that these macroeconomic headwinds, coupled with inherent structural inefficiencies, have created a complex environment for credit access. Among the most affected are Micro, Small, and Medium Enterprises (MSMEs), which form the backbone of Nigeria’s economy.”
According to Okhaimo, “against the backdrop of a renewed national ambition, it is important that we anchor today’s conversation with the evolving realities of our economic environment. Nigeria’s macroeconomic outlook reflects a steady trajectory toward inclusive and sustainable growth, driven by gradual reforms and sectoral diversification. Recent data from the National Bureau of Statistics (NBS) shows a commendable Gross Domestic Product (GDP) growth of 3.13% in Q1 2025 after rebasing, a significant improvement from the previous quarters. This growth was supported by strong performance in the services and non-oil sectors, indicating the economy’s growing resilience amid inflationary pressures, rising interest rates, volatile exchange rates, and elevated energy costs that have significantly eroded the purchasing power of consumers and increased operating expenses for MSMEs, and local manufacturers.
“These macroeconomic headwinds, coupled with inherent structural inefficiencies, have created a complex environment for credit access.
Among the most affected are Micro, Small, and Medium Enterprises (MSMEs), which form the backbone of Nigeria’s economy. According to the NBS, 40% of MSMEs make up the bedrock of our economy, contributing approximately 48% to Gross Domestic Product (GDP) and accounting for a vast majority of employment. Yet, they face constraint in accessing credit. The funding gap for Nigerian MSMEs is staggering, as an estimated 80% of MSMEs lack access to formal credit due to unavailability of collateral requirements, high-risk perception from lenders, and the inflationary pressure leading to high borrowing costs that have historically stifled MSMEs growth. We commend Development Finance Institutions (DFIs) such as BOI, DBN, NEXIM, and BOA for their critical interventions, but also recognize the role of commercial banks, microfinance institutions, fin-techs, and recent government initiatives like CrediCorp in expanding credit access and driving financial inclusion.
“Their collective efforts are especially vital, as Nigeria’s formal financial inclusion rose to 64% in 2023, up from 54% in 2020, while total financial inclusion (formal and informal) reached 74%, leaving 26% of the adult population still excluded, according to EFInA’s Access to Finance (A2F) survey. Similarly, challenges in consumer credit access persist. While many Nigerians struggle to finance essential needs for housing, vehicles, healthcare, education consumer credit remains underpenetrated: As of January 2025, total outstanding was ₦4.12 trillion, down from ₦4.42 trillion in November 2024, and still represents only about 15.5% of total bank credit (≈ ₦8.24 trillion). Additionally, formal consumer lending makes up less than 3% of GDP, indicating significant unmet demand. Many households turn to informal borrowing, further highlighting systemic gaps.
“We commend CrediCorp for enabling over 90,000 beneficiaries to access structured consumer credit since April 2024.
NCGC will further support this momentum by de-risking lending and expanding access across underserved segments. Our local manufacturing sector, vital for job creation and import substitutions, is grappling with severe credit constraints. The Manufacturers Association of Nigeria (MAN) reports that Q1’ 2025 exports tumbled by ₦746 billion, from ₦1.04 trillion in Q3 2024 to ₦294 billion, attributing the drop largely to crippling interest rates at 27.5%. Additionally, 767 manufacturers closed in 2023, resulting in over 18,000 job losses in 2024. MAN, also highlights that more than 40% of manufacturers cannot access the funding needed to operate at full capacity, while unstable forex rates and high energy costs add to the burden.
“We commend institutions like BOI, DBN, SMEDAN, and NEXIM for expanding access to credit and capacity support. NCGC will further de-risk lending and boost inclusive financing across the sector. To strengthen ongoing efforts by DFIs, financial institutions, and government initiatives in tackling credit constraints, the National Credit Guarantee Company Limited (NCGC) was established as a strategic partner to de-risk lending and expand access. With a ₦100 billion initial capital, NCGC complements existing interventions by providing credit guarantees that unlock sustainable financing for underserved sectors.
“Our mandate is clear: we are here to play the crucial role of a guarantor of loans, thereby reducing the risks for lenders and encouraging increased credit availability. We do not lend directly; rather, we provide partial credit guarantees, covering a portion of potential loan defaults. This innovative approach incentivizes financial institutions to extend more credit, confident in the knowledge that a part of the risk is borne by the NCGC. NCGC is a catalyst for economic transformation. By providing this much-needed safety net, we aim to expand access to finance to MSMEs, local manufacturers and credit consumers; thereby minimizing the risk exposure of Participating Financial Institutions (PFIs), lowering default rates, and ultimately driving economic growth and promoting financial inclusion. Our success hinges on inclusive partnerships and collaboration with all stakeholders in the financial ecosystem.
“We firmly believe that by working together, we can build a more inclusive, resilient, and dynamic credit market in Nigeria. To achieve this, we will partner with PFIs, leverage data and technology, engage industry groups, build capacity, raise public awareness, and advocate for enabling credit policies. This forum is not just a formal gathering it is a strategic call to action. We invite you, our financial institutions and partners to join us in building a future where credit is accessible, risk is shared, and growth is inclusive. Together, we can ensure that viable borrowers, whether farmers, traders, entrepreneurs, or manufacturers are met with opportunity, not exclusion, as NCGC strengthens the credit value chain through risk-sharing mechanisms. As we open this new chapter, I wish to thank every stakeholder present. Your presence here affirms that the vision for a financially inclusive, credit-enabled Nigeria is shared. Let us move from dialogue to design, from intention to impact. At NCGC, we are open for business. Let today mark the start of deep, strategic, and sustained partnership that will reshape Nigeria’s credit landscape”.
In his discussion of the issue Biodun Adedipe, founder/chief consultant, B. Adedipe Associates Limited said that the company coming into existence “is that component of the credit market that can strongly drive inclusive growth and deepen industrial manufacturing. All stakeholders should collaborate to make it work. He said that the greatest risks are moral hazards and political interferences which it must guide against in order to realise its potential to operate profitably. The company has started on a good note with well-defined modus operandi and mechanics, and it has a solid leadership team,” Adedipe said.
The forum was not just a formal gathering it was a strategic call to action. With a N100 billion initial capital, NCGC complements existing interventions by providing credit guarantees that unlock sustainable financing for underserved sectors. NCGC mandate is clear: to play the crucial role of a guarantor of loans, thereby reducing the risks for lenders and encouraging increased credit availability. NCGC does not lend directly; rather, the company provides partial credit guarantees, covering a portion of potential loan defaults. This innovative approach incentivises financial institutions to extend more credit, confident in the knowledge that a part of the risk is borne by the NCGC. While many Nigerians struggle to finance essential needs for housing, vehicles, healthcare, education, consumer credit remains under penetrated. As of January 2025, total outstanding was N4.12 trillion, down from N4.42 trillion in November 2024, and still represents only about 15.5 percent of total bank credit (about N8.24 trillion).