ELAN canvasses economic development through leasing

THE Equipment Leasing Association of Nigeria [ELAN] has called on the Federal Government to achieve its developmental agenda through leasing.

    The Chairman of ELAN, Chuka Onwuchekwa, who made this call at a press briefing in Lagos, said while the general economic conditions remain challenging, there are great opportunities for leasing business. 

   ‘’It is generally established that leasing thrives in a booming or a declining economy. In the Nigerian situation, the dwindling fortune will equally come with financing challenges for asset acquisition and the need to have innovative financing sources for the acquisition of productive assets. Indeed, there are wide financing gaps in the Nigerian economy, which presents immense opportunities.

  “Government can achieve its developmental agenda in all sectors of the economy, especially agriculture, power, infrastructure, information and telecommunication technology, housing, solid minerals, transportation, MSMEs and others through equipment leasing, as assets would be required throughout the value chains of these sectors”.

  “The whole essence of leasing therefore is to enhance the planning, improvement and development of any economy. The fact that leasing “facilitates convenient and easy access to capital equipment goes to show the unique role of leasing in building and supporting productive ventures, this will be very relevant to achieving the developmental initiatives of government and supporting private sector investment”. 

   He stated few of the advantages of leasing to include: “Cash management which allows access to productive assets with convenient and flexible rental payment scheme and absence of collateral since the asset serves as collateral”. In particular, leasing is even more relevant, given the tough economic conditions where access to productive assets is increasingly difficult especially to MSMEs. 

  The Chairman however added that, “the desired performance and continuous growth “of the leasing industry in Nigeria, is predicated on the capacity of the industry to overcome the various challenges affecting its growth and development”.

  “Appropriate funding for instance, is critical to the success of the leasing industry. The available sources, which are primarily banks appear inadequate to provide the right kind of funding for the leasing industry to meet the huge demand for capital assets in the economy, there is therefore need for a funding mechanism that would provide cheap long term funding. For instance, some of the intervention funds for development in specific sectors of the economy can be channeled through leasing”