In the last two years, a staggering 7.8 million small businesses have collapsed, representing a 20% decline in the number of existing businesses, as per the Association of Small Business Owners of Nigeria (ASBON). The President of ASBON, Femi Egbesola, urged the government to ensure that recently announced palliatives reach genuine business owners, emphasizing effective monitoring and implementation.
The dire business environment, marked by high operational costs, inflationary pressure, over-taxation, and lack of access to funding, has driven many small and medium-sized enterprises (SMEs) to shutter operations. Solomon Aderoju, National Vice President of the Nigerian Association of Small and Medium Enterprises, highlighted the government’s reluctance to address these challenges, despite the significant contribution of SMEs to the economy.
The post-COVID-19 economic realities have hit SMEs hard, leading to an urgent need for financial support packages like grants and interest-free loans. Access to finance remains a major concern, with only 15% of SMEs in Nigeria reported to have secured bank loans or credit, as noted by a survey by the World Bank. In light of the gloomy situation, stakeholders are calling for prompt and accessible funding to revitalize the struggling SME sector.