MICROCAPITAL BRIEF: Nigeria’s National Association of Microfinance Banks (NAMB) Asks Government Not to Set Up Microlenders

The Lagos State Chapter of the National Association of Microfinance Banks (NAMB), a trade group of microfinance banks (MFBs) in Nigeria, has reportedly asked the federal government not to set up MFBs [1]. Mr Olufemi Babajide, the Chairman of the chapter, opined that previous attempts by government agencies to set up MFBs failed because they were perceived as “national cake,” presumably meaning that borrowers did not feel it important to repay loans funded by taxpayers. Mr Babajide further stated that if such MFBs were set up and they failed, there could be a “spillover effect” that would negatively impact private MFBs. Instead, Mr Babajide said the government should offer private MFBs funding support. In some countries government-backed microfinance has undercut private actors with subsidized rates that cannot be matched by market funding.

As of April 2011, NAMB had 820 members. Its Lagos State Chapter has 180 members as of December 2011.

By Nisha Koul, Research Associate

About National Association of Microfinance Banks (NAMB): The National Association of Microfinance Banks of Nigeria (NAMB) is a trade group of microfinance banks (MFBs) that merged with the Association of Microfinance Banks in Nigeria (AMBN) in 2009. As of April 2011, NAMB has 820 member MFIs. Its Lagos State Chapter has 180 members as of December 2011.

Sources and Additional Resources:

[1] The Nation, “NAMB to Govt: stop ministries from floating microfinance banks,” http://www.thenationonlineng.net/2011/index.php/business/31458-namb-to-govt-stop-ministries-from-floating-microfinance-banks.html

MicroCapital.org story, December 20, 2011, “MICROCAPITAL BRIEF: Fortis Mobile Money to Enable Mobile Phone Banking for 180 Members of Nigeria’s National Association of Microfinance Banks, Lagos State Chapter (NAMBLAG),” https://www.microcapital.org/microcapital-brief-fortis-mobile-money-to-enable-mobile-phone-banking-for-180-members-of-nigerias-national-association-of-microfinance-banks-lagos-state-chapter-namblag/

MicroCapital.org story, September 1, 2011, “MICROCAPITAL BRIEF: Nigeria’s National Association of Microfinance Banks (NAMB) Establishes Trust Fund to Provide Funds to Member Microfinance Banks (MFBs),” https://www.microcapital.org/microcapital-brief-nigeria%E2%80%99s-national-association-of-microfinance-banks-namb-establishes-trust-fund-to-provide-funds-to-member-microfinance-banks-mfbs/

MicroCapital Universe Profile: National Association of Microfinance Banks (NAMB), https://www.microcapital.org/microfinanceuniverse/tiki-index.php?page=National+Association+of+Microfinance+Banks+of+Nigeria+%28NAMB%29

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