The Credit Crunch: How the use of movable collateral and credit reporting can help finance inclusive economic growth in Nigeria
This report is based on research commissioned by the Central Bank of Nigeria and IFC to understand the awareness, perceptions, and behavior of micro-small and medium-sized enterprises with regard to access to finance and financial services. The objective was to gain an understanding of the current knowledge and use of credit, credit information, credit bureau services, and collateral in Nigeria. One of the key findings of the study is that very few loan applications made by MSMEs and their employees are actually rejected by financial institutions: according to the survey, the vast majority of loan applications by MSMEs are successful (87 percent). While this does not indicate that financial institutions are more lenient on collateral requirements, it may indicate that smaller businesses who perceive that they will not meet the lending criteria do not bother to apply for bank loans.