FG Revs Up Auto Industry with N20bn Credit Scheme
By Patience Ikpeme
President Bola Ahmed Tinubu has directed the Nigerian Consumer Credit Corporation (CREDICORP) to prioritize the return of iconic brands like Peugeot and Dunlop to the country.
This ambitious vision is coupled with the launch of a N20 billion consumer credit fund aimed at stimulating the purchase of locally-assembled vehicles.
Engr. Uzoma Nwagba, Managing Director/CEO of CREDICORP, confirmed the President’s directive during the launch and signing of a Memorandum of Understanding (MoU) for the credit scheme. The ceremony, held in Abuja, brought together CREDICORP, the National Automotive Design and Development Council (NADDC), and the Nigerian Automotive Manufacturers Association (NAMA).
Nwagba revealed President Tinubu’s desire to see a resurgence of renowned automotive brands in Nigeria, stating, “The President told me: I want to see Peugeot, Dunlop and others come back to the country.” This directive underscores the government’s commitment to revitalizing the domestic auto sector and fostering economic growth.
CREDICORP’s mission is to create a scenario similar to developed nations, where car ownership is facilitated by single-digit interest rate financing. The auto credit programme, slated to commence in January 2025, aims to make vehicle ownership more accessible for Nigerians.
Nwagba emphasized collaboration with domestic automakers and relevant organizations like the Nigeria Automotive Manufacturers Association (NAMA) and the National Automotive Design and Development Council (NADDC). This collaboration seeks to drive down car prices and ensure they are within reach of Nigerian consumers.
“We are trying to make the financing more available and more easily accessible,” explained Nwagba. “Meaning in terms of the rates also, to enable Nigerians to have cheaper credits.”
CREDICORP intends to partner with financial institutions to offer competitive interest rates, targeting single-digit financing in the long term. Nwagba acknowledged the current high-interest rate environment but expressed optimism for the future.
“We know that interest rates are quite high and is one of the discouraging factors,” he said. “But given the mandate of Mr. President and his passion for enabling people to get cheaper credit…we are targeting lending on a single-digit interest rate.”
The credit scheme is intended to address the issue of “transport poverty” in Nigeria, where many citizens, particularly in urban areas, struggle with access to reliable transportation.
Director General/CEO of NADDC, Oluwemimo Joseph Osanipin, echoed the sentiment of a “better late than never” approach to the auto credit scheme. He highlighted the scheme’s potential to stimulate economic activity across various sectors.
“We are happy when the President came, it’s part of the New Hope Agenda to stimulate the economy,” stated Osanipin. “And there is no better way to stimulate the economy than to provide credit that will boost and increase the demand for auto products.”
The launch marks the first phase of the consumer credit fund, with leading local automakers like Innoson, Nord, CIG (GAC), PAN, Mikano, Jets, NEV (electric), and DAG already signed on as participants.
The N20 billion credit scheme, coupled with President Tinubu’s vision for a resurgent domestic auto industry, signals a potentially transformative period for Nigeria’s car market. With increased affordability and revitalized local production, Nigerians may soon see a renewed landscape for car ownership.
