TheCable

Tokunbo Abiru, senator representing Lagos east district, says small businesses play a crucial role in improving the country’s economy.

Abiru spoke on Thursday when he launched the N300 million constituency intervention revolving loan at 6 percent per annum for micro, small and medium enterprises (MSME) and entrepreneurs in Lagos east senatorial district.

Speaking on his support for MSMEs in the district, Abiru said they play a pivotal role in economic development and that they contribute hugely to the national gross domestic product (GDP) of the nation.

“Micro, small and medium enterprises (MSME) play an important role in the economic development process. This reality is acknowledged globally,” he said.

“They play crucial roles in job creation, income redistribution, mobilisation of small savings, technology adaptation, economic inclusion, and many more. In Nigeria, the MSMEs account for about 50 percent of our gross domestic product and over 80 percent of employment and have footprints across all sectors of our economy,” he said.

“Therefore, they offer good channels for the realisation of development objectives of job creation, economic inclusion, and poverty reduction.

“Access to finance has been identified by various studies as one of the biggest challenges faced by small businesses in the Nigerian economy. Many MSMEs, out of desperation, take loans from informal financial markets and finance companies at outrageous interest rates, sometimes as high as between 50% and 120% per annum.

“MSMEs are also subjected to a lot of complex requirements such as loan collaterals, strenuous documentation, and bureaucratic processes which impede access to credit by these small businesses.

“This constituency intervention revolving loan for MSMEs will go a long way in bringing succour to our numerous small businesses in the Lagos east senatorial district. To ensure the sustainability of the scheme, we have developed a risk management framework to make the scheme an enduring and revolving facility that will impact many more people beyond the first round of beneficiaries.”

Also speaking at the event, Babajide Sanwo-Olu, governor of Lagos, said Abiru is contributing to ameliorating one of the key challenges mitigating MSMEs from reaching their full potential.

Represented by Gboyega Soyonwo, his deputy chief of staff, Sanwo-Olu commended the senator for the initiative, adding that he has continued to keep faith with the people.

“I commend my dear brother, distinguished Senator Mukhail Adetokunbo Abiru for Keeping faith with his constituents, the good people of Lagos east senatorial district, and the entire people of Lagos state through effective representation at the red chamber and the various empowerment programmes he has initiated including the one being unveiled here today,” Sanwo-Olu said.

“This is an example of the dividends of democracy our people desire and we will not relent in ensuring that the welfare and wellbeing of our people remain our one and only priority.”

On his part, Muda Yusuf, chief executive officer of the Centre for the Promotion of Private Enterprise (CPPE), said the initiative deserves all the necessary support.

“This remarkable initiative by distinguished Senator Tokunbo Abiru resonates perfectly with our core mandate as a civil society organization, which is the promotion of private enterprise,” he said.

“We believe that to salvage this economy and ensure social stability, we must promote the growth of private enterprises, especially the small businesses. And we must do this in a manner that is impactful and sustainable. In light of this, it is the belief of the CPPE that this initiative deserves all the necessary support.”

Members of the constituency interested in taking the loan can apply HERE.