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Federal Government Presidential Conditional Grant Scheme (PCGS) Rolls Out To Empower Nano Businesses Across Nigeria

The Federal Government has rolled out the Presidential Conditional Grant Scheme (PCGS) to empower Nano businesses as part of the Presidential Palliative Program.

Beginning on March 9, 2024, the scheme offers financial grants, without repayment obligations, to eligible small business owners operating in various sectors such as trading, food services, ICT, transportation, creatives, and artisans. The PCGS targets 70% women and youth, 10% people with disabilities, and 5% senior citizens, with the remaining 15% distributed to other demographics.

By focusing on the often overlooked group of business owners, the program seeks to unlock the potential of Nigeria’s burgeoning entrepreneurial ecosystem and drive sustainable economic development at the grassroots level.

The N50,000.00 (Fifty Thousand Naira) grant per beneficiary paid directly to beneficiaries’ accounts will reach one million small businesses in the 774 local government areas (LGAs) and the six council areas in the Federal Capital Territory (FCT). With a target of 1,000,000  beneficiaries in every LGA and the FCT, the program has the potential to impact communities nationwide significantly.

Beneficiaries of the initiative have been selected through a rigorous process that includes the verification of each business owner through their National Identification Number (NIN) and Bank Verification Number (BVN).

The successful applicants met specific criteria, including owning a small business with progressive economic potential, a willingness to grow, and engage at least one additional staff member when necessary. Applicants also provided proof of residential/business address and relevant personal and bank account information before the December 18, 2023 deadline.

The Presidential Conditional Grant Scheme underscores the government’s commitment to supporting small-scale entrepreneurs and driving inclusive economic growth. With a strong emphasis on inclusivity and empowerment, the PCGS is poised to make a tangible impact on the lives of small business owners and their communities across Nigeria.

The initiative is implemented by the Federal Ministry of Industry, Trade and Investment with the Bank of Industry as the Executing Agency.

For more information about the Presidential Conditional Grant Scheme (PCGS), please visit the official website [].

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The Federal Government of Nigeria through the Federal Ministry of Industry, Trade, and Investment (FMITI), has established three funds totaling N200,000,000,000 (Two Hundred Billion Naira) to support businesses across Nigeria: The Presidential Conditional Grant Scheme (PCGS); The FGN MSME Intervention Fund; and the FGN Manufacturing Sector Fund. The Bank of Industry (BOI) has been appointed as the executing agency of the funds, vested with the responsibility for its day-to-day administration.

The Presidential Conditional Grant Scheme (PCGS), is a N50,000,000,000 (Fifty Billion Naira) grant scheme to support eligible Nano Business owners. The Grant will be disbursed to a minimum of 1,000 beneficiaries (especially Women and Youths) per Local Government Area (LGA) in the 774 LGAs across the Nation and the 6 (six) Council Areas in the FCT. The target nano businesses include: Traders, Food Vendors, ICT businesses, Transporters, Artisans, Creatives, among others. This is the grant component of the initiative, as beneficiaries are not required to pay back. To be eligible, beneficiaries must own a nano business and be willing to register a business name as their business grows, and be willing to engage at least one additional staff member if the business turnover increases; They must also be willing to provide proof of residential/business address in their Local Government Area, provide relevant personal and bank account information, including but not limited to Bank Verification Number (BVN) and National Identification Number (NIN) for verification of identity. The beneficiary must meet the application submission deadline for the scheme.

The FGN MSME Intervention Fund, is a N75,000,000,000 (Seventy-Five Billion Naira) fund, for Micro, Small and Medium Enterprises (MSMEs) in Nigeria. The fund would be used to support eligible micro, small and medium enterprises and serve as a cushion against the high cost of production, marketing and distribution of products arising mainly from infrastructure deficiencies and other ancillary factors involving MSMEs in Nigeria. Each beneficiary would receive a maximum of N1,000,000 (One Million Naira). The fund would be disbursed at an interest rate of 9% all-inclusive per annum, with a tenor of 3 years for equipment and working capital.

The FGN Manufacturing Sector Fund is a N75,000,000,000 (Seventy-Five Billion Naira) fund, that would be used to support eligible manufacturing companies and help cushion against the high and rising costs of production, marketing and distribution of products arising from infrastructural deficiencies and other ancillary factors affecting the manufacturing sector in Nigeria. Beneficiaries would receive up to N1billion (One Billion Naira), disbursed at an interest rate of 9% all-inclusive per annum, with a tenor of 5 years for term loans, and 1 year for working capital.

The MD/CEO, Bank of Industry, Dr. Olasupo Olusi, reiterated BOI’s commitment to the development of MSMEs as the bedrock of the economy, which is in line with His Excellency, President Bola Ahmed Tinubu’s Renewed Hope Agenda.

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Design Thinking In Solving Organizational Problems

“Recognizing the need is the primary condition for design” – Charles Eames 

Design thinking (DT) originally came about as a way to teach engineers how to approach problems creatively, as designers do. Since then, it has been used effectively within a variety of industries, customising the process to their environment, challenges, and goals. Market leaders like IBM, Google, and Tesla also use design thinking as an innovative methodology to guide their product development. It helps them see the world through the eyes of their customers. 

Addressing the needs of consumers is a powerful way to drive innovative thinking. In today’s rapidly changing world, it is becoming increasingly difficult to proffer a one-size-fits-all approach to customer expectations. This is due to advancements in technology, changing tastes and lifestyles, increasing purchasing power and so on. Organisations today have to address more complex problems. To address these problems, there is a need to better understand the consumers and what they expect to gain. 

Design thinking puts the consumer at the centre of problem-solving. To be able to proffer solutions to a problem, it is important that organisations understand the impact on the consumer. Design thinking encourages organisations and businesses to focus on the human point of view above all else, and to build this focus into each step of the product development cycle. This means designing products and services with people’s needs and preferences firmly in mind. For instance, a software company will prioritise design functionality, dependability and security which will allow consumers to transact in a clear, simple and intuitive way. 

Steps in Design Thinking

  • Empathize: Empathy helps to understand the problem of the consumer by setting aside assumptions. It is when you understand how a problem impacts a consumer that you can empathise. We can practice empathy through observation and interviewing. 
  • Define: The outcome of this step is a problem statement. It involves asking what problem we are trying to solve. It helps identify the features that are a priority in the solution. 
  • Ideate: This requires an exhaustive exploration and evaluation of possible solutions (i.e. brainstorming), in a bid to address the pain points of customers.
  • Prototype: It involves developing a quick representation of the solution i.e. a physical object, a drawing, or an experience map. It selects a handful of innovative proposals and turns them into prototypes. 
  • Test: Here, we test the prototype by gathering feedback to determine its effectiveness. It is an iterative process with opportunities for improvement.

Benefits of Design Thinking

  • Cost-effectiveness: DT enables the testing of ideas without committing resources i.e. companies are able to evaluate the effectiveness of a new product or service, without having to go through the entire process of developing the product. 
  • Non-linear problem solving: DT allows companies the flexibility to jump from step to step as needed. For example, if the prototyping step does not work, a company can re-start the ideation process.
  • Managing complexity: Complex problems can be solved by focusing on user needs and the limitations of existing products and services
  • Market discovery: DT opens up the opportunity for companies to discover entirely new markets. For example, the iPhone started with the question of how to avoid customers juggling multiple devices. By working on how to make things easier for people, Apple invented the smartphone, which opened up a whole new global market.
  • Tailored solutions: User experience (UX) is emphasised when capturing customers’ mindset during the design process. 

Leveraging Design Thinking in BOI

Despite monumental successes that the bank has achieved over the years, BOI is not immune to challenges and as such, adopting a design thinking framework could help in efficiently executing some of its strategic objectives. For instance, improving access to BOI loans by the youth segment can be further enhanced by leveraging the DT approach by dialoguing with the segment to understand their limitations. Brainstorm on potential solutions and jointly analyse possible solutions and thereafter test/pilot such solutions for effectiveness. 

Pitfalls to avoid in Design Thinking 

Design thinking often leads to comprehensive solutions. However, the framework may not work for all objectives. As such, it is important not to lose sight of other pragmatic approaches to executing corporate objectives. In addition, clear and simplified communication is key in the iterative development stage of problem definition. 

We conclude with a quote by Laura Ashley – “We don’t want to push our ideas onto customers, we simply want to make what they want.

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Economic Development and Industrialisation in Nigeria: The Role of the Bank of Industry

“Economic growth without investment in human development is unsustainable and unethical” – Amartya Sen

In the wake of the recent economic recession, the first since 1991, Nigeria released a new development plan – Economic Recovery and Growth Plan (ERGP) – that set out specific objectives for achieving economic growth of 7% by 2020. This release followed earlier plans such as Nigeria Industrial Revolution Plan (NIRP), National Economic Empowerment and Development Strategy (NEEDS), the 7- point agenda, and others that targeted both economic growth and development within a specified period.  The implementation of these plans has allowed Nigeria to record some measure of growth. However, the recent recession and its contributing factors (global oil price reduction, unavailability of Foreign Exchange etc.) have shown that Nigeria needs to develop sustainable sources of foreign exchange earnings to fund economic development, besides oil.

To ensure more sustainable growth, Nigeria has to prioritise economic development that produces long-term growth. Focusing on this will require a clear definition of what economic development means for Nigeria, how it can be attained, and the identification of key actors and roles in its attainment. 

Although GDP growth is essential for development, other metrics such as improved competitiveness and standards of living are also important to ensure economic development. The terms economic growth and economic development are often used interchangeably but they have quite distinct meanings; Economic growth is an increase in aggregate national output. This is usually of short-term benefit. Economic development involves the fundamental transformation of an economy, leading to long-term economic benefits. It is about positioning the economy on a higher growth trajectory while focusing on improving intrinsic development factors such as unemployment, literacy, life expectancy and poverty rates. This can be achieved by causing institutional changes, altering industrial structures, the educational and occupational characteristics of the population, and the entire social and cultural fabric of a nation. It is the product of long-term investment in generating new ideas, knowledge transfer, and infrastructure. Economic development requires quality improvements and innovation. As a result, a requirement for realising development is the presence of the innovative entrepreneur. These entrepreneurs usually focus on introducing goods with a higher value and can comfortably compete within and outside their country. 

Nigeria possesses an abundance of natural resources and comparative advantages that present a good starting point for the pursuit of sustainable economic development.

In addition to a favourable climate, Nigeria has vast amounts of natural resources and a large population. It has the 6th largest gas reserves and the 8th largest crude oil reserves in the world. It is also endowed in commercial quantities with about 44 solid mineral types and has a population of close to 200milliom. The existence of these advantages presents vast opportunities with which Nigeria can push for a trend of continuous economic development.

However, to fully utilise these advantages, we must encourage the notion of competition at both the micro and macro levels. This will see industries attach a premium to improving productivity. It will also see the Nigerian industries transition from a focus on the production of primary goods to the production of secondary goods with a higher value. Such transition is possible only through the mechanisation of the production process. This is argued to be a hallmark of industrialisation. As a result, a focus on the attainment of economic development in Nigeria is indicative of a focus on driving the process of industrialisation within the country. 

Where does the Bank of Industry come in? 

The Bank of Industry (“BOI”) is one of the public institutions tasked with the mandate of promoting industrialisation in Nigeria. The bank does this by providing both business and financial support to small, medium, and large-scale Nigerian enterprises. Such support provides enterprises with the financing needed to acquire equipment (machines) to improve the efficiency of the production process. We also provide them with business advisory services to ensure that they have the necessary capabilities and know-how needed to operate sustainably. BOI’s role in enabling industrialisation, and economic development, cannot be understated. The application of machinery enables enterprises to produce goods that are not only value-adding but can also compete locally and internationally.  

The ERGP and NIRP have placed industrialisation, entrepreneurship, and competition as being central to achieving their objectives. Due to its role as a financer of enterprises BOI is being depicted as probably the most important tool the government has to promote economic development in Nigeria. BOI will continue to strengthen collaborations for greater developmental impact and increase support for enterprises, leading to improved competition, innovation and economic development in Nigeria.

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Economic Development through the Nigerian Informal Sector: A BOI perspective

“Informal conversation is probably the oldest mechanism by which opinions on products are developed, expressed and spread” – Johann Arndt

2017 saw Nigeria record its first full year of growth after experiencing its first recession in 25 years. While this recovery brought an increase in business confidence, concerns remain as GDP growth was less than national population growth. These concerns persist even as the IMF projected 2.1% growth for 2018, which falls below the population growth forecast of 2.6%. Population growth, coupled with high underemployment and unemployment rates (a combined 40%), will result in an increase in the number of job seekers in 2018. It also translates to an increase in the number of people who look to the informal sector for economic survival. The Nigerian Informal Sector (IS) is a major contributor to the Nigerian economy, accounting for a significant portion of employment and national GDP. According to the IMF, the Nigerian informal sector accounted for ~65% of Nigeria’s 2017 GDP. 

So what is the informal sector?

The Informal Sector comprises any economic activity or source of income that is not fully regulated by the government and other public authorities. This includes enterprises that are not officially registered and do not maintain a complete set of accounts, and workers who hold jobs lacking basic social or legal protection and employment benefits. Examples of informal employment workers include street traders, subsistence farmers, small-scale manufacturers, service providers (e.g. hairdressers, private taxi drivers, and carpenters), etc. 

The sector currently accounts for over half of global employment and as much as 90% of employment in some of the poorer developing countries. Due to its flexible nature, the informal sector can easily adapt to difficulties such as the current global recession, providing some measure of support to those most in need. Despite its importance, the informal sector is often overlooked and misunderstood, with some viewing it as transient, and expected to be eventually absorbed into the formal economy. 

Today, there is no unanimous perspective on the informal economy. Some believe that the informal sector encourages fraudulent activities that result in the loss of revenue from taxes, weak unions, unfair competition, a loss of regulatory control, and disregard for health and safety standards, among others. However, a fast-growing view is that the informal economy offers significant job creation, income generation potential, and the capacity to meet the needs of poor consumers by providing cheaper and more accessible goods and services. With the significant contribution of the informal sector to the Nigerian economy, an undeniable truth is that any notion of economic development in the country is one that hugely depends on the state of affairs in the informal sector. Sustainable and inclusive economic development and job creation are unlikely to be achieved unless the potential and needs of the informal sector are adequately considered. Thus, efforts must be made to understand the dynamics of the sector and how best to tap the latent potential that lies within. 

If previous attempts at intervention were unsuccessful, what can be done to maximise the potential of the informal sector in Nigeria? 

Historically, stakeholder interventions in the informal sector have been focused on how to regulate businesses, and effectively integrate them into the formal economy. Limited emphasis has been given to identifying the drivers of growth in the various sub-sectors within, and the challenges experienced by participants. The Nigerian Informal sector players face a myriad of challenges including inadequacy of technology, education, markets, land and physical infrastructure, limited access to finance, and limited skills development. Policy interventions to support the sector must therefore be two-fold. Firstly, efforts should be made to create more formal jobs to draw workers out of the informal sector. Secondly, policies should be introduced to address identified challenges in the informal sector towards improving productivity and incomes of informal sector players

What role does the Bank of Industry play in supporting the Informal Sector for national development? 

Current BOI interventions in the informal sector include both training and financial support for market women, artisans, traders (through the FG’s “Government Economic Empowerment Programme “GEEP product”) and artisanal miners (through the Artisanal and Small-Scale Miners – “ASM Fund”). A critical look at these interventions shows BOI adopting a hybrid model that prioritises the attainment of both economic growth (GEEP) and development (ASM Fund). In the formal sector, BOI continues to provide funding and capacity building to enterprises, for business expansion,  inevitably leading to job creation.