. . . Promote Lower Interest Rates On Loans
The Central Bank of Nigeria (CBN), has issued guidelines on how to regulate and supervise Credit Guarantee Companies (CGC) in the country.
This aimed at boosting access to financial for the Micro, Small and Medium Enterprises (MSMEs) in Nigeria.
The disclosure was made in a circular signed by the CBN’s Director of Financial Policy and Regulation Department, I.S Tukur.
According to the circular, the guidelines is a regulatory foundation for credit guarantee firms, seeking to minimize credit risk, promote lower interest rates on loans and complement other regulatory measures targeted at promoting MSMEs.
The circular further explained that CBN acted on the constitutional provision guiding the Apex Bank; by the section 2(d) of the CBN Act 2007 and section 56(2) of the banks and other financial institutions Act (BOFIA) 2020.
The circular also noted that the guidelines were developed in recognition of the role of guarantee schemes in facilitating lending in the country.