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BANKING & FINANCE

Microfinance Banks Lament Harsh Business Environment

The harsh operating business environment in Nigeria seems to be taking its toll on Microfinance banks.

According to the Chief Executive Officer of Accion Micro finance Bank, Bunmi Lawson, the high cost of doing business is hindering the growth of micro finance banks in the country.

She said: “You have to spend a lot on infrastructure. You have to generate your own power, water supply, connectivity. So we spend a lot to bring these services to people at a cheap rate at cost that they can afford and is sustainable.”

Lawson also disclosed that the sector witnessed low loan repayment last year as a result of the challenges most businesses faced in 2014.

“2014 was a challenging year especially for businesses and we saw a slight deterioration on the loan portfolio part,” she added.

“We certainly hope that after the election has settled, it would become better. Although when you look at the decline in oil prices and the deterioration of the naira, it may be a tough time,” Lawson concluded.

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