National Credit Guarantee Company Set to Revolutionize Access to Credit in Nigeria

By Lod Onyeji

The National Credit Guarantee Company Limited (NCGC) is poised to commence operations on July 1, 2025, as a specialized financial institution designed to unlock access to credit and drive inclusive economic growth across Nigeria's real economy. With a substantial initial capital commitment of ₦100 billion, recently announced by President Bola Ahmed Tinubu, NCGC aims to reshape the way Micro, Small, and Medium Enterprises (MSMEs), manufacturers, and strategic sectors access vital financing.

*Bridging the Financing Gap*

For decades, Nigerian businesses, particularly MSMEs, have struggled to access loans due to collateral barriers and high-risk perceptions. NCGC is bridging this gap by providing partial credit coverage to banks and other financial institutions, enabling them to lend more confidently to eligible borrowers, especially in underserved and high-growth sectors.

*Key Features of NCGC's Operational Model*

- *Partial Credit Guarantees*: Covering up to 60% of outstanding principal on qualifying loans

- *Co-Guarantees*: Collaborating with other institutions to jointly share lending risk

- *Technical Assistance*: Providing capacity-building support for lenders and borrowers to enhance credit readiness and portfolio quality

*Target Beneficiaries*

- *MSMEs across all regions*

- *Local manufacturers and value chain operators*

- *Credit consumers*

- *Youth and women-led enterprises*

- *Export-oriented and non-interest-based businesses*

- *Large enterprises within priority sectors*

*Sectoral Coverage*

NCGC's guarantees will be available across critical sectors, including¹ ²:

- *Agriculture & Agribusiness*: From inputs to processing and logistics

- *Renewable Energy & Green Economy*: Including solar, clean tech, and mini-grids

- *Manufacturing & Infrastructure*: Targeting value-added production and light industry

- *Digital & Tech Enterprises*: Including startups, fintechs, SaaS, and logistics tech

- *Solid Minerals and Metal*: Metal fabrication, recycling, beneficiation, coating, etc.

*A Catalyst for Economic Transformation*

By incentivizing lenders to serve more businesses safely and sustainably, NCGC is enabling job creation, driving productivity, and fostering a more self-reliant economy. Its operational model is designed to:

- *Unlock access to finance for real sector growth*

- *Create jobs and alleviate poverty*

- *Drive inclusive economic outcomes*

- *Strengthen the MSME ecosystem*

- *Build trust and scale in Nigeria's credit markets*³

With NCGC set to play a pivotal role in implementing the Renewed Hope Agenda, it represents a bold commitment by the government to support Nigerian businesses, reduce lending risks, and create a resilient, inclusive economy.