Fidelity Bank plans to increase loan book with SME lending

Fidelity Bank Plc, one of Nigeria’s most capitalised financial institutions, says it intends to intensify support for Micro and Small Medium Enterprises (MSMEs) through a number of unique initiatives geared towards raising their level of competitiveness in a challenging business environment.

This year, the bank hopes to increase its loan book by aggressively lending to MSMEs which have been touted to be the next cash cow in the economy.

Speaking on the Fidelity SME Forum, a weekly radio talk show programme organized by the Bank on Inspiration FM. Lagos, Managing Director/Chief Executive Officer, Fidelity Bank Plc., Nnamdi Okonkwo disclosed that the bank currently boasts of a 50 percent SME loan to deposit ratio, which is an indication that the lender remains highly committed to supporting MSMEs in Nigeria, particularly in the area of access to finance.

He explained that Fidelity Bank’s SME deposit liability which is in excess of N120 billion and loans in excess of N60 billion are clear testaments to the Bank’s avowed commitment to the sector.

Alluding to the Bank’s plan to step up the tempo of engagement with MSMEs amid the nation’s harsh economic conditions, Okonkwo noted that the Bank’s SME customer base is in excess of 600,000 and are evenly spread across Nigeria’s geographical regions.

The Bank Chief pointed out that the lender has made significant headway in the disbursement of the Central Bank’s MSME Development Fund as 70 customers have already accessed requisite credit to expand their business. “We are currently one of the top two (2) leading banks in the disbursement of the Fund”, he added. According to him, Fidelity focuses more on productive segments of the economy where margins are not robust. This move, he added helps MSMEs in these industry verticals optimize the performance of their respective businesses.

“The structure and pricing of the funds provide us the window to finance SME related transactions, which otherwise would have been expensive to finance from our balance sheet for the SMEs”, he explained. Propelled by its one-on-one business advisory services and other capacity building initiatives, Okonkwo, said the lender has one of the strongest SME franchise in Nigeria, Africa’s largest economy by GDP. He explained that the financial institution’s decision to organise regional SME conference series was borne out the need to help small businesses in all geopolitical zones build capacity needed to aid the diversification of the Nigerian economy by harnessing economic opportunities which their immediate environments offer.

“We just finished one in Ibadan December 2015 where we had most of the key MSMEs in the South West in attendance. “Before that, we had done one in Enugu for the South East SMEs. By the end of the month, we are heading to Kano for the North West SME Conference”, the Fidelity boss said. With the prevailing economic condition characterized by falling oil prices, revenue drought and the resultant capital controls of the Central Bank of Nigeria (CBN), the Fidelity boss urged SMEs to raise their management game in order to take full advantage of the myriad opportunities which the downturn offers. “We see a lot of growth opportunities in Manufacturing, Services and Agric. Value-chain, especially in the segments that are directly related to import substitution and export activities”, he further explained.

To take advantage of these opportunities, Okonkwo said small businesses in the manufacturing and food processing business space will need to make strides in the following areas: “quality control and packaging, proper corporate governance structures and processes, effective financial management system, improved compliance with regulatory authorities and product differentiation.”

HOPE MOSES-ASHIKE