Mr Oluwagbenga Ogundeji, south-west zonal coordinator of SMEDAN, said this during a stakeholders’ meeting with heads of small business groups and associations on the proposed rating agency on Thursday in Osogbo.
He explained that the rating agency, which would be an agency within SMEDAN, would be known as ‘Small and Medium Enterprises Rating Agency’ (SMERAN).
According to him, it will be established in partnership with the Nigeria Export-Import Bank (NEXIM), the Bank of Industry (BOI) and others.
He said the forum with shareholders was to deliberate on how the Micro, Small and Medium Enterprises (MSMEs) could access cheap loan in line with federal government ease of doing business.
“A majority of the MSMEs are operating as informal entities and do not have the capacity to maintain minimum corporate governance standards.
“As a result most fund providers do not have confidence extending loans to enterprises whose track records are neither known to them nor easily verifiable.
“Such businesses are therefore perceived to have a high risk. This contributes largely to the inability of MSMEs to access affordable credit.
“The establishment of SMERAN is intended to reduce the turnaround time in MSMEs’ access to funds and other critical resources.” he said
He said the objectives of SMERAN, when established, would be to provide investment information, advisory services and credit rating services.
He added that SMERAN would also provide services to ascertain the credit worthiness of issuers of debt obligations and debt instruments.
He said SMERAN would also play the role of advisers and consultants on problems relating to the administration and organization of MSMEs. He said the SMERAN programme would hopefully commence before the year ends.