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By Chinwendu Obienyi
To create a robust and sustainable economic structure that facilitates increased economic activities or purchases using credit, the Federal Government has said it will collaborate with the National Institute of Credit Administration (NICA) to establish a framework for consumer credit in the country.
According to the government, NICA will provide the advisory, policy drafting, legislative and regulatory advocacy services, while serving as catalyst for the process, among others.
Commending the government’s recent efforts in revitalizing the industries in the country to increase production, consumption and financial inclusion, the Registrar/Chief Executive Officer of NICA, Prof Chris Onalo, noted that Nigerians desire to buy things that they want on credit, especially household appliances, automobile, mortgages, medical bills, loans, mobile telephone infrastructure, amongst others.
He emphasized that this is a role NICA has to play in supporting the transition from a cash-based system to a credit-driven economic regime which will provide opportunities for citizens to contribute their own quota to economic development.
Onalo said, “With NICA’s statutory power, the federal government felt that this is the Institute to work with; the government can partner with NICA to advance economic development, particularly in moving the economic landscape from what it has been since independence to a new horizon.”
According to Onalo, the framework which is expected to be launched by the President soon, will increase economic activities, accesses consumer purchase using credit as well as being able to take business loans from banks under a safe and sound sector-wide credit guarantee arrangements for the nation’s micro, small and medium enterprises (MSMEs).
The Federal Government in November 2022, launched the NICA Act No 26 of 2022 with the objective to serve as a national body of expertise for matters relating to credit management in the country by setting professional standard, awarding professional qualifications in credit management; testing and assessing those who wish to become members, controlling, supervising and regulating the profession of credit management in Nigeria.
This also includes enhancing, promoting and protecting the interest of business credit, consumer credit, financial credit and trade credit providers and grantors across sectors of the economy.
The Act also enables NICA to promote the integrity and weigh the capacity of government at all levels to borrow for economic development against the backdrop of internal creditworthiness assessment of the overall economy.
Since the NICA Act was unveiled, the institute has continued to commit to the development of a holistic credit based economy.
In December, the Presidential Council on Industrial Revitalization, formed a Technical and Regulatory Working Groups composed of NICA, Central Bank of Nigeria, National Identity Management Commission, and the Federal Competition and Consumer Protection Commission to develop a framework to improve consumer credit in Nigeria, among others.
Other members are the National Insurance Commission, Bank of Industry, the Federal Inland Revenue Service, International Finance Corporation, the Ministry of Finance, the Ministry of Industry, Trade and Investment, as well as the Ministry of Digital Economy and Telecommunication.
The Committee was given a five-month schedule to complete its objectives, according to a statement by the Minister of Industry, Trade, and Investment, coordinating the process.
