Non-Interest Loan

By Abubakar Suleiman 

1. The 7 pm national broadcast by President Bola Ahmed Tinubu on the 31st of July 2023 was timely, especially as many Nigerians are still trying to pick up the pieces of their lives necessitated by the country’s current economic realities and hardship. The removal of oil subsidy and redressing of the multiple exchange rate system are undoubtedly the major causes of this new current of hardship and inflation. 

2. There is seemingly no love lost between the government and the hoi polloi; hence Nigeria’s presidential speeches or live chats are not accorded due relevance. The masses see them as the old regurgitated rhetorics or decoys used to sway them from nagging realities. 

3. However, no matter how much we have lost confidence in the government’s promises, we still need to give it the benefit of the doubt and allow it to test-run its policies and strategies. At the same time, critical stakeholders hold it as responsible and accountable as is humanly possible. 

4. The little over 1700 words speech tagged “After Darkness Comes The Glorious Dawn” sounds promising and reassuring that Mr President’s removal of the subsidy and his intention or action plan to cushion the effect of its removal are noble. However, the noblest of plans might still fail if the economic and even cultural behaviours of the actual or direct beneficiaries of lofty government interventions are not considered. 

5. Therefore, it is against this backdrop that I wish to interrogate some aspects of the government interventions in the broadcast speech that have hugely and negatively affected many practising Muslims in the past and will invariably have the same effect in the coming months. 

6. In his speech, Mr President rightly emphasised that his economic interventions will drive financial inclusion by onboarding beneficiaries into the formal sector, but I think this inclusion did not take into cognisance many practising Muslims’ behavioural approach towards accessing loan facilities as it contravenes a delicate aspect of our religious dictates – usury. 

7. For instance, the economic intervention with the noble, planned scheme of funding 100,000 MSMEs and start-ups with N75 billion, whereby promoters will access between N500,000 and N1million, is laced with 9% interest per annum and a repayment period of 36 months. Despite the loan’s appealing single-digit interest rate, many practising Muslims who want to venture into start-ups have been shortchanged because a “non-interest” model seems not to have been incorporated into this scheme. 

8. Plus, the aforementioned is also the case with interventions in the manufacturing sector that is aimed at funding 75 enterprises that have the potential to “kick-start sustainable economic growth, accelerate structural transformation and improve productivity.” President Tinubu earmarked N75 billion between July 2023 and March 2024 for this promising purpose. Still, the “9% interest per annum” is a huge stumbling block for practising Muslims. 

9. In the twenty-third paragraph of the text speech, Mr President hinted that the know-how of Development Finance Institutions and commercial and microfinance banks would be tapped for a viable and appropriate transactional structure for all stakeholders. 

10. Therefore, an encompassing financial inclusion plan that carries all members of social strata (especially practising Muslims) bearing the brunt occasioned by oil subsidy removal and the eradication of multiple exchange rates is feasible and should also be implemented. And this should be quickly considered to bring business ideas to fruition, resurrect dying businesses and lift millions from among the Muslim populace above the poverty line. 

11. If there is one thing Tinubu’s presidency should help the Muslim Ummah with, then it should be financial inclusion through non-interest loans and financing of businesses. 

12. As a matter of necessity, the National Assembly shouldered with the responsibility of making laws should look into the Acts of Banks and other financial institutions and tweak certain provisions that impede the development of viable and encompassing solutions around non-interest loans and financing of businesses. 

13. Consequently, the likes of the Central Bank of Nigeria, the Bank of Industry, the Development Bank of Nigeria, the Bank of Agriculture, the Federal Mortgage Bank of Nigeria and other financial institutions should have workable solutions around non-interest issues to bring a significant chunk of the Muslim population on board government’s socioeconomic interventions. It is a gateway to take many Muslims out of poverty, in sha Allah. 

14. Again, the other thing Muslims would find useful from this presidency is collaborating with state governments to find a way around street begging and almajiranci – reformation or whatever works. 

15.  As a matter of urgency, Ulamas or faith-based organisations should make these demands as bargains for the 2027 presidential and National Assembly elections, for it will indeed augur well for Muslims going forward. These demands need nagging, strategic campaigns, and comprehensive media coverage. And immediate, mid and long-term results should be attached to these demands.

Abubakar Suleiman writes from Kaduna and can be reached via abusuleiman06@yahoo.com.

By Muhammad Abdurrahman

Despite millions of applications by Nigerian Muslims for the Central Bank of Nigeria’s interest-free interventions, the apex bank decides to discard this critical project.

A year ago, on July 24, 2020, the Central Bank of Nigeria (CBN) unveiled series of guidelines for the non-interest financial interventions under its Agri-Business, Small and Medium Enterprise Investment Scheme (AGSMEIS), Micro, Small and Medium Enterprises Development Fund (MSMEDF), the Accelerated Agricultural Development Scheme (AADS) and host of others. Millions of Nigerians, especially Muslims guided by the sermons of prominent clerics and the assistance of many Muslim IT specialists and academics, applied for these CBN’s interventions.

Nevertheless, more than a year later, there has not been any information or explanation from the CBN regarding these crucial programmes. As a result, Nigerians are now left only with speculations, which are gradually gaining ground.

Many people alleged that some interests within the bank and the country’s financial architecture sabotage the interventions, with all the consequences on the Federal Government’s acclaimed concern for integrated development.

In a statement signed by the National Secretary-General of the Da’awah Coordination Council of Nigeria (DCCN), Engr Ahmad M.Y. Jumba said, “It will be a great disservice for the Federal Government, which has been widely applauded for this milestone, to allow this intervention to end up in the dustbin of calculatingly sabotaged policies and programmes. If the CBN is serious, why then the delay in implementation even as it continues to implement other programmes?

“The Da’awah council calls on the authorities concerned to expedite action and make those interventions immediately available, accessible and affordable. At a time when many Nigerians are suffering from extreme poverty and hunger, when small businesses are crumbling due to lack of capital, when millions of youth are roaming the streets with no jobs and no access to start-ups; at this time of hyperinflation amidst dwindling incomes, we find it suicidal for the CBN to remain conspicuously silent about a programme that has all it takes to support Nigerians get out of poverty and put our dear nation on the path of inclusive growth and sustainable development,” Jumba lamented.

Some applicants contacted by The Daily Reality cried out that as is the norm for Muslim faithful, they had resorted to prayers and anticipation for God’s intervention. On this note, Jumba also added that:

“It is our hope that the Federal Government will fulfil its promise by directing the CBN to immediately release the modalities for accessing those interventions in the shortest possible time.

“We will call on all religious leaders, Imams, in particular, to use their pulpits and deliver QUNUT against any person who is deliberately engaged in sabotaging the interventions,” Jumba concluded.