Jude Mathias, the President of the caretaker committee for microfinance institutions (MFIs) for the National Association of Microfinance Banks of Nigeria (NAMB), recently made a request for Nigerian farmers to “cooperate” with the sector’s current standards and regulations. This appeal came in response to recent complaints from the Oyo State Branch of the Association of Nigerian Farmers that the six percent interest rate charged on loans from MFIs is too high. Information on the time period corresponding to the interest rate is unavailable. Mathias claimed that the complaint was “uncalled for,” since part of the interest earned by banks pays for expenses related to marketing clients’ businesses to ensure entrepreneurial success and traveling in order to collect payments.
For more information on issues faced by the Nigerian microfinance sector, see MicroCapital articles in bibliography below.
About National Association OF Microfinance Banks of Nigeria (NAMB) :
The National Association of Microfinance Banks of Nigeria (NAMB), an association of various microfinance institutions (MFIs), was recently reformed by merging with the Association of Microfinance Banks in Nigeria (AMBN), under the supervision of the Central Bank of Nigeria (CBN). For more information on this merging of associations, visit the last MicroCapital brief in the bibliography.
Bibliography:
[1] AllAfrica.com. “Nigeria: Association Seeks Farmers’ Involvement in MFBs.” http://allafrica.com/stories/printable/201001040579.html
[2] About National Association of Microfinance Banks. https://www.microcapital.org/microfinanceuniverse/tiki-index.php?page=National+Association+of+Microfinance+Banks+of+Nigeria+(NAMB)
[3] MICROCAPITAL BRIEF: Vanguard News Claims Central Bank of Nigeria (CBN) Will Revoke Operating Licenses of Several Microfinance Banks
[4] MICROCAPITAL BRIEF: Nigeria Deposit Insurance Corporation (NDIC) Blames Microfinance Institutions (MFIs) for Lending Failures, MFIs Fault “Bad” Nigerian Borrowers
[5] MICROCAPITAL BRIEF: Central Bank of Nigeria (CBN) Encourages Microfinance Banks (MFBs) To Cut Costs https://www.microcapital.org/microcapital-brief-central-bank-of-nigeria-cbn-encourages-microfinance-banks-mfbs-to-cut-costs/
[6] MICROCAPITAL.ORG BRIEF: Nigerian Microfinance Banks Pledge to Form Single Organization in Response to Supervision Crisis
Original Source Article: AllAfrica.com
Nigeria: Association Seeks Farmers’ Involvement in MFBs
January 4, 2010
Jude Mathias, an official of the National Association of Microfinance Banks of Nigeria has appealed to farmers to be part of the growth of microfinance banks in Nigeria.
Mathias made the appeal on Thursday in Lagos, following complaints by the Oyo State Branch of the Association of Nigerian Farmers that microfinance banks had allegedly, failed to assist the agricultural sector.
He told the News Agency of Nigeria (NAN) that the complaint that the six per cent interest rate charged by microfinance bank was too high was uncalled for.
He said that farmers should remember that the entire interest rate “does not go to the bank but for other services, part of which goes to the customer”.
Mathias, who is the President of the caretaker committee for microfinance banks, said that the bank “organises workshop and seminars for customers on book keeping as well as visit customers in their places of businesses.
“It will be wrong to say the six per cent interest rate charged by microfinance bank is too high because part of the interest rate is also used to ensure that the customer succeed.
“When you look at the role microfinance banks play in marketing the business of their clients and sometimes come to the doorsteps of their clients to collect their proceeds for banking, you will agree with me that the rate is very small,” he said.
NAN reports that the Oyo State Chapter of the Association of Nigeria Farmers had recently complained that the interest rate by microfinance banks was too high to assist the growth of the agricultural sector.
The farmers said that the bank ought to reduce the interest rate from six per cent to enable small-scale farmers to benefit from the scheme.
Similar Posts:
- MICROFINANCE PAPER WRAP-UP: “Impacts of Microcredit Access on Climate Change Adaptation Strategies Adoption and Rice Yield in Kwara State, Nigeria,” by Adejoke Yewande Bakare et al
- MICROCAPITAL BRIEF: Activists Block Access to 3 Microfinance Institution Branches in Nepal, Accusing MFIs of Causing Over-indebtedness
- MICROCAPITAL BRIEF: QR Codes to Facilitate Retail Payments Across Cambodia-Laos Border
- MICROCAPITAL BRIEF: Baobab+, TradeLenda Partner on Solar Energy Solutions for SMEs in Nigeria
- MICROFINANCE PAPER WRAP-UP: “Financial Inclusion in Niger: Challenges and Opportunities,” by Yoro Diallo et al, Published by IMF
