NICA flays multinationals, financial institutions for poor MSMEs support

National Institute of Credit Administration (NICA) has expressed concern over the inadequate support that Micro, Small and Medium Enterprises (MSMEs) receive from multinational corporations, financial institutions, and other key stakeholders in the Nigerian economy.

The worry is expressed in a statement by the Registrar/Chief Executive Officer of NICA, Prof Chris Onalo. The institute noted that despite their critical role in driving economic growth, job creation and national development, MSMEs had continued to struggle with limited access to credit, unfavourable lending conditions and insufficient financial backing from major players in the business and financial sectors.

It noted: “As Nigeria transitions towards a more credit-driven economy, the survival and expansion of MSMEs are increasingly dependent on the willingness of the government, financial institutions and big corporate entities to create an enabling environment. Banks’ long-standing reluctance to offer flexible loan options and stringent collateral requirements and multinational corporations and other big business conglomerates’ general apathy toward integrating MSMEs into their value chains have significantly stifled small businesses’ growth potential in Nigeria.”

According to the statement, quoting recent economic reports, MSMEs contribute over 50 per cent of Nigeria’s Gross Domestic Product (GDP) and account for more than 80 per cent of employment opportunities.

“However, they continue to face significant challenges, including unfair treatment by larger businesses, limited access to structured credit, delayed invoice payments, and insufficient patronage from banks, multinational corporations and large enterprises. These obstacles hinder their ability to scale and compete effectively in both local and international markets.

“Beyond credit access, financial institutions, multinational corporations and other large conglomerates also fail to support MSMEs by patronising their businesses. Rather than engaging MSMEs for procurement and service contracts, they prefer dealing with large corporations or those owned by insiders in top management positions. This practice deprives MSMEs of essential business opportunities and stifles competition in the economy. The federal government is advised to put legislation in place to check this trend,” the statement added.

It also lamented delayed settlements of MSMEs’ invoices, saying even in cases where large corporations and financial institutions engaged MSMEs, invoice settlements were delayed for 30, 60, or even 90 days, in an internal payment policy that appeared detrimental to the growth of small businesses.

“NICA remains committed to advocating a robust credit and financial system that supports businesses of all sizes. We urge financial institutions, multinationals, large conglomerates and policymakers to take decisive action to ensure that MSMEs receive the oxygen, i.e., credit and financial backing, business opportunities, and mentorship they require to flourish. A thriving MSME sector translates to a stronger economy, increased jobs and wealth creation, and sustainable development for all,” the statement added.