Lagos Targets Small Businesses With Affordable N10m Loan Scheme

Lagos Targets Small Businesses With Affordable N10m Loan Scheme
Loans offer 9% Interest
Ambrose-Medebem noted that MSMEs contribute about 80 per cent of employment and approximately 75 per cent of Lagos State’s Gross Domestic Product

The Lagos State Government has announced that eligible micro, small and medium enterprises (MSMEs) will be able to access loans of up to N10 million at a single-digit interest rate of nine per cent per annum under a new financing initiative.

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Eko Hot Blog reports that the loans will be disbursed through the Lagos State Access to Finance for SMEs through Cooperatives (LASMECO) programme.

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The Commissioner for Commerce, Cooperatives, Trade and Investment, Folashade Ambrose-Medebem, disclosed this on Monday at the opening of a three-day accelerator training workshop organised to prepare partner organisations for the rollout of the programme.

Represented by the Director of Cooperative Services, Dr. Adeyinka Adeyemi, the commissioner said LASMECO was established to bridge the financing gap facing MSMEs by providing affordable credit through registered cooperative societies instead of relying on conventional collateral.

She explained that beneficiaries would have access to term loans of up to 36 months with a six-month moratorium, as well as working capital loans of up to 24 months with a three-month moratorium.

According to her, the initiative is jointly supported by counterpart funding from the Lagos State Government, matching funds from the Bank of Industry (BOI) and operational support from Sterling Bank.

Ambrose-Medebem noted that MSMEs contribute about 80 per cent of employment and approximately 75 per cent of Lagos State’s Gross Domestic Product (GDP), yet many businesses remain unable to access formal credit because of high interest rates and stringent collateral requirements.

Lagos Targets Small Businesses With Affordable N10m Loan Scheme — Folashade Ambrose

She said the programme leverages registered cooperative societies as a credible alternative for securing loans, making affordable financing available to more entrepreneurs.

The commissioner added that priority would be given to businesses operating in agriculture, manufacturing, healthcare, the digital economy, creative industries, environmental sustainability and education.

She urged the 17 accelerator organisations participating in the training to identify viable businesses, prepare them to become loan-ready and monitor beneficiaries to ensure strong repayment performance.

Ambrose-Medebem also disclosed that the ministry is digitising the state’s cooperative registry to improve transparency, beneficiary verification and programme monitoring.

She revealed that although Lagos has more than 13,000 registered cooperative societies, only between 1,900 and 2,200 are currently active, creating an opportunity to revive dormant cooperatives through LASMECO.

Earlier, the Permanent Secretary in the ministry, Babatunde Onigbanjo, represented by the Director of Administration and Human Resources, Adeniyi Oladipupo, said the workshop would equip accelerator organisations with the skills needed to recruit, screen, mentor and prepare MSMEs for financing.

He explained that participants would receive practical training in beneficiary recruitment, credit readiness, loan documentation, monitoring and reporting to ensure effective implementation of the programme.

Onigbanjo added that accelerator organisations would only receive support fees after the businesses they nominated successfully secured funding, describing the arrangement as a performance-based accountability measure.

He also warned that applicants must not be charged any application, training or evaluation fees, stressing that violations of the programme guidelines would attract sanctions.

Speaking at the event, Bank of Industry customer care officer, Omotayo Babalola, said the training would enhance her ability to assist businesses with documentation, loan applications, disbursement processes and repayment procedures.