NICA advocates State-Level Credit Guarantee Corporations to empower Nigerian entrepreneurs

To accelerate economic growth and empower citizens, Prof. Chris Onalo, Registrar/CEO of the National Institute of Credit Administration (NICA), has called on state governments across Nigeria to establish State-Level Credit Guarantee Corporations (SCGC).

In a report titled, – Credit  Economy  Advocacy  (CEA):  The  Case  for  State 
Governments in  Nigeria to Setup State-Level “Credit Guarantee Corporations” to Propel Economic Growth’, he said this initiative complements the federal government’s efforts through the National Credit Guarantee Company (NCGC) and aims to expand access to credit for businesses and individuals.

State Credit Guarantee Corporations have the potential to transform local economies by providing guarantees to lending institutions, reducing the risks associated with lending to Micro, Small, and Medium Enterprises (MSMEs) and low-income residents. Such guarantees unlock capital that would otherwise remain inaccessible, enabling thousands of entrepreneurs to grow, innovate, and contribute meaningfully to their state economies.

Prof. Onalo emphasized that SCGCs could also promote financial inclusion by targeting underserved communities traditionally excluded from formal borrowing. “By guaranteeing loans for this segment, state governments can reduce poverty, empower households, and integrate more residents into the formal economy,” he said.

In addition to boosting credit access, SCGCs can stimulate job creation, encourage entrepreneurship, and diversify local economies beyond oil dependency. State governments can earn additional revenue through loan-risk sharing service fees and interest income while fostering a culture of responsible borrowing and financial integrity among business owners.

NICA, a chartered professional regulatory body in credit management, is advocating strongly for this initiative. The institute provides training, networking opportunities, and professional recognition for members, helping them enhance their skills and credibility in credit and business management. NICA also advises governments at all levels on matters relating to credit economy management.

Examples of proposed institutions include Lagos State Credit Guarantee Corporation, Kano State Credit Guarantee Corporation, Rivers State Credit Guarantee Corporation, and others across Nigeria. Each state can tailor its credit solutions to local economic sectors such as agriculture, trade, manufacturing, technology, and transportation, ensuring maximum developmental impact.

According to Prof. Onalo, the establishment of state-level credit guarantee corporations is a timely strategy that can unlock the full potential of Nigerian entrepreneurs, create jobs, promote financial inclusion, and stimulate sustainable economic growth nationwide.