The TraderMoni scheme of the Federal Government has generated a significant amount of buzz and national conversation from those who laud its impact, and those who view it as politically motivated. TraderMoni is one of 3 micro-credit products of the Government Enterprise and Empowerment Programme (GEEP).
In an interview with BusinessDay, Uzoma Nwagba, the Chief Operating Officer of GEEP, explained how GEEP was designed to address the significant challenge of access to funds for micro-enterprises and financial inclusion. This article captures some salient points from the interview, shedding light on the objectives and achievements of the TraderMoni initiative.
The GEEP initiative is a microcredit program aimed at providing essential capital to traders, artisans, farmers, and petty traders. Launched in 2016, it acknowledges that over 30 million Nigerians engage in active commercial activities but lack access to credit facilities. As of 2017, only a mere 0.04% of bank loans reached this micro-segment, highlighting a significant gap in the financial system.
Understanding the GEEP Initiative
GEEP serves as a social intervention program, comprising three distinct products: MarketMoni, FarmerMoni, and TraderMoni. Each of these products aims to empower individuals at the grassroots level by providing access to capital. The initiative recognizes that many potential beneficiaries have little to no financial track record, no collateral, and often lack formal identification, yet they actively contribute to the economy.
The beneficiaries of GEEP are sellers of everyday items, from foodstuffs to beverages, and they represent a vast segment across the 36 states and the Federal Capital Territory (FCT). By providing targeted support, GEEP aims to onboard these individuals into the formal financial system, allowing them to become sustainable recipients of credit.
Loan Structure and Accessibility
Loans offered through the GEEP initiative range from N10,000 to N300,000, allowing petty traders to start small and graduate to larger amounts as they repay their loans. This structure is essential for individuals who may not have the resources to meet traditional lending requirements, such as Bank Verification Numbers (BVNs), Know Your Customer (KYC) documentation, or collateral.
To facilitate the loan process, GEEP utilizes field agents equipped with tablet computers to streamline applications and disbursements via mobile wallets. This innovative approach is set to transform the lending ecosystem, making access to funds easier for those who need it most. Over the past two years, the program has disbursed 1.5 million loans, with 1.2 million beneficiaries falling under the TraderMoni scheme alone.
Addressing Criticism: Is TraderMoni Politically Motivated?
Despite the positive impact of the GEEP initiative, some critics label TraderMoni a vote-buying scheme. However, it is crucial to note that the program was launched in 2016, well before any election season. The first loan registrations took place in May 2016, and the program has consistently operated across the country since then.
By November 2017, the Bank of Industry had already disbursed over 300,000 loans, demonstrating the initiative's commitment to financial inclusion, irrespective of political affiliations. The fundamental question remains: is GEEP affecting millions of Nigerians positively? If yes, then timing should not deter the availability of much-needed credit to those who seek it.
Challenging Assumptions About Economic Actors
Critics often assume that people at the bottom of the economic pyramid are incapable of making informed decisions regarding their financial futures. This narrative tends to overlook the fact that these individuals are just as ambitious and deserving of dignity as any middle-class entrepreneur. It is essential to recognize that these beneficiaries possess goals and aspirations and are actively seeking ways to improve their lives.
Interestingly, many states with large numbers of TraderMoni beneficiaries do not politically align with the current governing party, further challenging the notion of political motivation behind the scheme. The eligibility criteria focus solely on being a Nigerian petty trader, thus emphasizing inclusivity.
The Impact of TraderMoni on Financial Inclusion
The success of the TraderMoni program is evident, with over half of the 1.5 million beneficiaries being first-time users of bank accounts or mobile wallets. This shift towards financial inclusion signifies a crucial change in the economic landscape, as more individuals gain access to essential banking services.
The Bank of Industry remains dedicated to targeting the vast population of financially excluded Nigerians. With over 30 million individuals still lacking access to credit, the journey to improve financial inclusion is ongoing, and TraderMoni plays a pivotal role in this transformation.
In conclusion, the TraderMoni initiative is more than just a financial program; it represents a commitment to empowering millions of Nigerians who have historically been overlooked by traditional lenders. By facilitating access to capital and integrating beneficiaries into the formal financial system, GEEP is fostering economic growth and resilience at the grassroots level.
For more insights and details, you can follow this link to read the full interview with Uzoma Nwagba.
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Source: Legit.ng
