The National Institute of Credit Administration (NICA), chartered, has urged businesses across Nigeria seeking access to bank loans to leverage the credit guarantee services of the National Credit Guarantee Company (NCGC), describing the scheme as a critical policy instrument for unlocking credit to the real sector and strengthening the country’s economic-wide credit delivery mechanism.
In a press statement, NICA stated that its advocacy on credit access is carried out pursuant to its statutory mandate under Act No. 26 of 2022 S.1(2)(f) “consulting with and making recommendations to the government, regulatory bodies, trade associations, academic community and other professional bodies on all matters relating to credit management”, which empowers the Institute to regulate, promote, and advance best practices in credit economy management across Nigeria. NICA noted that access to credit remains one of the most persistent challenges facing Nigerian businesses, despite growing demand for the presence of viable, revenue-generating projects in the economy. According to the Institute, Micro, Small and Medium Enterprises (MSMEs) in particular continue to encounter difficulties securing loans due to high collateral requirements, perceived credit risks, and cautious lending practices by lending institutions.
NICA explained that the establishment of the NCGC is aimed at addressing these structural barriers through a structured risk-sharing framework. Under the arrangement, the NCGC provides partial credit guarantees to participating financial institutions, covering up to 60 per cent of the loan principal in the event of default. This mechanism, the Institute said, reduces lenders’ exposure while encouraging them to extend credit to businesses with strong fundamentals but limited collateral.
The Institute emphasized that credit guarantee schemes are globally recognised as effective tools for stimulating lending, especially to businesses who are unable to secure loans due to lack of ability to provide collaterals, and the underserved segments of the economy. By lowering risk for lenders, NICA noted, the NCGC framework has the potential to encourage access to credit by MSMEs, farmers, entrepreneurs, and emerging enterprises, while maintaining sound credit management standards.
NICA further stated that the NCGC initiative whose capital base shall be urgently increased to One trillion naira is expected to support key sectors of the economy, including local manufacturing, agriculture, value-chain development, and export-oriented businesses. Youth- and women-led enterprises, which often face disproportionate challenges in accessing financial credit, were also identified as major beneficiaries of the scheme. So, what are those sectors waiting for? They should move now to access this opportunity.
Beyond improving access to credit, NICA said the effective deployment of the NCGC guarantee scheme would contribute to broader economic outcomes such as job and wealth creation, increased productivity, business expansion, and improved economic resilience. The Institute added that the NCGC initiative aligns with national efforts to deepen financial inclusion, strengthen the credit market, accelerate inclusive economic growth, and a people-centred economy.
NICA advised businesses interested in benefiting from the NCGC guarantee scheme to approach participating financial institutions or engage directly with the National Credit Guarantee Company to understand eligibility requirements and application procedures. The Institute reaffirmed its commitment to promoting best practices in credit management, advocating policies that support responsible credit transactions, and fostering a robust credit culture that supports sustainable economic development, and elimination of corruption in the economy.
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