President Bola Tinubu recently highlighted the achievements of the National Credit Guarantee Company (NCGC), which has successfully unlocked N46.95 billion in loans during its inaugural year. This was made possible through N21.59 billion in guarantees issued to 19 participating financial institutions.
In a series of posts on X (formerly Twitter), Tinubu explained that this initiative allows financial institutions to extend approximately N2.17 in loans for every N1 guaranteed by the federal government. This model aims to alleviate the challenges faced by viable businesses in securing loans due to insufficient collateral or credit history.
Tinubu emphasized that the NCGC was established to mitigate the risks lenders perceive when dealing with businesses lacking adequate collateral. By sharing part of the lending risk, the NCGC boosts lender confidence in extending credit to deserving borrowers.
Currently, the NCGC collaborates with 19 financial institutions, including 13 commercial banks, three microfinance banks, and three development finance institutions. The results from its first year indicate a promising start in enhancing credit access for businesses in need.