The Director of Policy and Planning, Mr. Luqman Mamudu, said the council is contributing about N7.5 billion at a low interest rate. Counterpart funding is coming from a company in South Africa.
Mamudu, who spoke during a press briefing in Lagos, said: “This is what we have been working on for the past two years. We looked at the available access to asset financing in the country, we found out that the high interest rate is frustrating the purchase of a new vehicle.”
He said: “This is the gap we want to fill. We are working with a company in South Africa which has footprints in eight African countries where they have developed a commercial and financial model to recoup their investment.”
NADDC is contributing N7.5 billion into the scheme. The South African company will source for finance from Development Finance Institution (DFI) at single digit interest rate.”
Mamudu said when the funds are put together, it will guarantee an interest rate that will be easy for people to purchase vehicles at 8 to 10 per cent.
”By the time we put the funds together, it will guarantee an interest rate that is fairly okay.
“We are in discussion with the Central Bank of Nigeria (CBN) to originate the loans and float it so that it will be attractive for investors to partake in the scheme. Going forward, this will further bring down the interest rate. This facility will be given to people that have the capacity to buy cars because we expect that they will have good credit to purchase a car.
“If you go to America, over 80 per cent ýof car purchases are through loans. The credit purchase scheme will assist the operators to help the masses,” he added.
Mamudu said the council was planning to build capacities in local assembling to attract component manufacturers to set up their factories in Nigeria.
