FG to spend N350bn on poverty reduction, consumer loans

• The committee consists of members from the CBN, the National Identity Management Commission, and the Federal Competition and Consumer Commission
  

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As per details from the newly approved N28.77 trillion 2024 Budget, the Federal Government plans to allocate N350 billion towards a consumer credit fund and a national poverty reduction strategy.

Outlined in the ‘House of Representatives Federal Republic of Nigeria Order Paper,’ specific line items of the budget revealed this intended allocation.

One line item (which appeared under ‘capital supplementation’ and ‘other service–wide votes’) ‘National Poverty Reduction with Growth Strategy (FGN Commitment, including NSIP Upscaling)’ got a total of N250bn while another item Consumer Credit Fund got N100bn.

The setting up of a consumer credit fund is coming weeks after the Presidential Council on Industrial Revitalisation announced it was establishing a Technical Working Group to develop a framework to enhance consumer credit in the country.

The committee consists of members from the CBN, the National Identity Management Commission, and the Federal Competition and Consumer Commission.

The Minister of Industry, Trade and Investment, Dr Doris Uzoka-Ani, said, “An efficient consumer credit system is a highly essential component of successful economies, as it works to improve market efficiencies and fill in gaps in consumption and productivity by providing consumers immediate access to credit, allowing them to purchase ahead of ability.

“The absence of a well-structured consumer credit system has been a significant impediment to financial inclusion and economic prosperity.”

She noted that while the country has numerous financial institutions and credit schemes, many Nigerians still face substantial hurdles in accessing credit due to stringent eligibility criteria, high-interest rates, identity-related challenges, fragmented data sources for proof of livelihood and financial worth, lack of awareness or understanding of credit processes, and inadequate credit available for lending.