As part of its effort to strengthen small and medium enterprises (SMEs) operations, Polaris Bank Plc said it has gone into a consultancy partnership with the International Finance Corporation (IFC), to evolve an effective lending framework for medium, small and medium enterprises (MSMEs).
The objective of the partnership, according to the bank is to produce a new lending framework for SMEs that de-emphasises reliability on collateral by focusing primarily on evaluating business viability. Based on the new framework, when a business passes the viability test, the bank can consider non-traditional collateral options outside real estate to reduce the difficulty faced by business owners in their bid to secure credit facilities from banks.
According to a statement issued by the bank , it also said it had concluded plans to stop charging commission on turnover (COT) on all retail current accounts, well ahead of the deadline given by the Central Bank of Nigeria.
The statement quoted the bank’s Head of Retail Banking Group, Nkolika Okoli, as saying that the bank’s new retail strategy has necessitated a shift from its previous product led to a more segment led approach.
The business focus would henceforth concentrate more on customers and less on products using unique value propositions built around the needs of each customer segment.
Okoli said since individual needs differ based on their economic worth and age, it follows that every customer-centric business should recognize these differences and provide solutions tailored to meet them. She explained that with the recent acquisition of Mainstreet Bank and the latest modern banking application software by Skye, the bank now has more reach, presence and is better able to serve its Retail customers efficiently.
The banker said that in addition to its in-house SME loans for small and medium business owners, Polaris Bank is also one of the SME-friendly banks appointed by both the Central Bank of Nigeria and the Bank of Industry to disburse the federal government’s MSME support funds.
As a way of supporting small business owners, she said Polaris Bank had begun a training program for SME owners in the six geo-political zones of the country to enable them overcome some of the challenges they face. SME’s are trained on how to access the government MSME intervention funds, the use of technology to drive business and operational efficiency, cashflow management, the importance of networking for success, experience sharing by successful business owners, etc.