According to a recent study by the United Nations Development Programme (UNDP), the development arm of the United Nations, a humanitarian organization promoting peace and better living standards, 21 percent of the Nigerian adult population – 18 million people – have access to financial services, with women and youth least likely to have access. Limitations of the Nigerian microfinance industry are attributed to lack of capacity, inadequate coordination, policy shortfalls and a lack of strategy regarding stakeholders’ roles and responsibilities.
In order to develop microfinance services in Nigeria, the UNDP, with the assistance of the United Nations Capital Development Fund (UNCDF), is providing support to the Central Bank of Nigeria, Nigeria’s central banking authority, for a 5-year microfinance development strategy. The support is in the form of technical assistance including policy reviews which are intended to increase the capacity and depth of financial services in Nigeria, such as a two-week management training for state-supported microfinance institutions on how to deliver financial services to alleviate poverty.
By Jennifer Shevock, Research Associate
About the United Nations Development Programme:
The United Nations Development Program (UNDP) is the United Nation’s development arm. The mission of UNDP is to provide developing countries with knowledge, experience and resources in line with the United Nations’ Millenium Development Goals, http://www.un.org/millenniumgoals/news.shtml. UNDP operates in 166 countries and works directly with national governments. UNDP also publishes the annual Human Development Report, which provides a benchmark for development from each of its country offices.
About the United Nations Capital Development Fund:
The United Nations Capital Development Fund (UNCDF) provides investment capital and technical advice to developing countries to promote private sector development, including microfinance institutions. UNCDF invests in 38 of the least developed countries as of 2009. Through its programs, UNCDF strives to contribute to the attainment of the Millennium Development Goals, http://www.un.org/millenniumgoals/news.shtml.
About the Central Bank of Nigeria:
The Central Bank of Nigeria (CBN) is Nigeria’s central banking authority, established in 1958. Some of the regulatory objectives of CBN are as follows: to issue legal tender, to maintain the external reserves of the country, to promote monetary stability and a sound financial environment, to act as a banker of last resort and serve as a financial adviser to the federal government.
Sources and Additional Resources:
“18 million Nigerians access microfinance sector ” August 4, 2010. http://234next.com/csp/cms/sites/Next/News/Metro/Politics/5602481-147/18_million_nigerians_access_microfinance_sector.csp
MicroCapital Universe: United Nations Development Programme: https://www.microcapital.org/microfinanceuniverse/tiki-index.php?page=United+Nations+Development+Program+%28UNDP%29
MicroCapital Universe: United Nations Capital Development Fund: https://www.microcapital.org/microfinanceuniverse/tiki-index.php?page=United+Nations+Capital+Development+Fund+%28UNCDF%29
MicroCapital Universe: Central Bank of Nigeria: https://www.microcapital.org/microfinanceuniverse/tiki-index.php?page=Central+Bank+of+Nigeria+%28CBN%29
United Nations Millennium Development Goals: http://www.un.org/millenniumgoals/news.shtml
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