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Collapse development banks’ into one to end roles duplication—BH FrontPage Comment
The key reasons behind several policy summersaults in Nigeria cannot not be too far from multiplicity of development agencies and duplication of their duties.
This issue had been discussed at various chambers of the National Assembly and all the debates ended up not coming up with a tangible policy proposition that can tame the tide.
In terms of development banks, it will be very hard for any follower of development economics of Nigeria to stand and name comfortably the number of development banks in Nigeria and their specific roles without listing same roles at the end.
It therefore means that we are driving intractable development with the same idea which according to respected philosophers will continue to give us same unproductive results.
For us at Business Hilights, we felt that the mantra of Change being driven by the present administration ought to have collapsed all of the development financial institutions.
Rather, the same government that came to power on the central campaign of Change still fall same prey of institutional multiplicity.
Counting the number of development banks in Nigeria is worrisome because many Nigerians who unfortunately the banks are supposedly meant for are not aware of their existence and their roles or limitations.
Here in Nigeria, there is Infrastructure Bank, still government is not talking about it or looking at its roles and contributions to infrastructure development more than many years of its existence.
The Infrastructure Bank is existing, but infrastructure deficit remains a national shame from the day it was set up till now, the deficit is getting out of hand and it is still there doing nothing.
There is also Federal Mortgage Bank of Nigeria (FMBN), but the number of home seekers accessing facilities from the bank on a yearly basis is not known so as to evaluate the performance and further determine it role to the housing delivery scourge hobbling the nation.
There is also Bank of Industry (BoI) currently managed by Waheed Olagunju. The bank, by its name was to assist industries but it seems it has lost focus in partnering with real industrialists and now enmeshed in confusing policies and reforms in the Small and Medium Enterprises (SMEs) level.
Many SMEs who were interviewed on how they see the performance of BoI expressed mixed reactions, meaning that the bank is still not doing what it should do to grow small businesses.
Just within the week, another type of bank was introduced, known as Development Bank of Nigeria (DBN).
Business Hilights gathered that the Central Bank of Nigeria (CBN) has approved a licence for the Development Bank of Nigeria with $1.3 billion as seed capital.
This was disclosed by the Minister of Finance, Kemi Adeosun on Wednesday.
The ministry, which is the chief promoter of the financial powerhouse, revealed in a statement that the CBN approved the grant of a Wholesale Development Finance Institution Licence with national authorisation to the DBN Plc.
Already, a confusion of roles and duplicity of functions have set in as the operation of the DBN is said to be clearly distinct from other development banks because it is focused on supporting small businesses defined by size and not by sectors.
We are quick to query the extent of DBN’s distinction when its core duty had been the roles of BoI?
BoI having failed mega industries suddenly meddled into supporting SMEs and now, the same SMEs will be supported by DBN. Can this stand over time?
Caveat: By the time of filing this report, Business Hilights had the fears that there may have been other development banks we may have skipped because we may not have known that they actually exist.