CBN must understand cooperative policy principles says CFAN Executive Secretary

Mr. Emmanuel Atama

The Executive Secretary of National Financing Cooperative of Nigeria (CFAN) Mr. Emmanuel Atama has advised on the need for Central Bank of Nigeria (CBN) to understand more policy principle of his organization

for the better performance of its new economic credit policy programme for the medium and small scale business enterprises at the rural areas thereby properly injecting the informal sector into formal in more economic synchronized way to generating more revenue in the country.

 He pointed that the role of cooperatives to rural economy development cannot be waivered in this dispensation of backward integration occasioned by down turn of crude oil in the global market which is already taking its tows in the country thereby commended the role of Federal Department of Cooperative of FMARD and IFAD-RUFIN for the  development support towards the more proactiveness of the CFAN added that the principle and working of the cooperative must be well included in the new policy of the credit finance policy of the Federal Government. Read the rest of his excerpts with us below.

 

Introduce yourself, association, position and the relevance of your association to the present economic development in Nigeria to start with?

My name is Emmanuel Atama, I am the Executive Secretary of the National Financing Cooperative of Nigeria (CFAN). CFAN before now was called National Cooperative Associations of Cooperative Trade Union of Nigeria (NACUN).But the 2002 cooperative policy recommended that NAUCUN be rebranded to meet the global cooperative economic policy practice, therefore today it has been rebranded to CFAN. As regards our contribution to the economy, we deal with bulk of the masses and these are the people that contribute to the development of the economy by one form of business or the other.

 So today, CFAN coordinate all the cooperatives that are into thrifts and credits to ensure that we boost the financial base for small business to strive. So today we are talking about financial inclusion of CFAN as we play a very good role towards ensuring that the grassroots rural economy have access to funds thereby able to contribute its quota back into the economy through taxes payment and also being able to provide data that will meet the decision of the relevant institutions towards ensuring good information about the development in the informal sub sector of the economy.

Cooperative in Nigeria is always seen from the level of “Esusu” meaning just a group contributing money for members in turns for repayment which from your description has been rebranded to having an interface with government and foreign affiliated organization etc, how strong are this your agency to responding to the present government economic policy for micro rural development of MSMEDF?

We are very strong on ground; we have offices from the National level which I am the Executive Secretary to the states levels of the federation. The state offices are the ones that coordinate the various local governments’ offices. Also the local governments’ offices are in form of unions that also coordinate activities down to the wards levels. We have just finished our summit in Asaba in Delta state where we recorded well over 1000 participants that came all across Nigeria including Bornu state that have been having incidence of Boko Haram. So, that tells you the level of our coordination and strength on how we are reaching out to ordinary citizen of Nigeria. So as we are concern, we have this structure from the National to the state levels where our activities flow down to the grassroot. That is the reason why we are saying that government should partner with us as we are giving assurance that the partnership will record high success particularly as it has to do with access to finance and financial inclusion, capacity building of the ordinary Nigerians so that they can be relevant in the economy activities of the country.

As the Executive secretary, you have recently being to Kenya, what is your experience in the meeting you led about 50 Nigerian delegates down on cooperatives matters?

Yes the Headquarters of all the Financial Cooperatives in Africa is in Kenya. As a matter of fact, the Headquarters for cooperative globally for Africa is in Kenya. And every year we have meetings on the Congress of Africa Confederation of Cooperative Credit Association (ACOCCA). The meeting is held annually for the purpose of discussion on how to operate cooperatives best practices and to ensure that the message gets down to the grassroot in order to ensure that the developmental purpose of the cooperative is achieved. 

The experience is that Kenya has laid a formidable structure for cooperative to strive. As a matter of fact, she uses cooperatives to drive her economy as you move on the street of the country; you will see all business activities growing inform of business cooperative as a result of coordination of small businesses that service the bigger ones. And all these small cooperative groups business have been well coordinated in Kenya for the purpose of financial and credit support towards involving the economy of formal and informal in a well synchronized ways for economic growth at the rural level. All these are what Kenya has been able to establish. 

We have gone to under study the cooperative model in Kenya for the purpose of replicating same as an agency that is saddled with the responsibility of making sure that cooperative in Nigeria also operates along that best global practice in the country. We have been linked by them with Irish Links Foundation and by February this year, a consultant will be coming from Island to interface with us as regards how they can provide support for us in terms of funding, capacity building and the whole lot of activities that enhance our being more proactive and stronger. The Irish cooperative link has provided support for Gambia counterparts of ours for over twenty years now. We are doing all our best to make sure that we position ourselves better for this kind of support.

How would you describe your relationship with Federal Department of Cooperative (FDC), Rural Agricultural Financing (RUFIN) and International Fund for Agricultural development (IFAD) cum Central Bank of Nigeria (CBN)?

Our relationship with the FDC is quite cordial. As a matter of fact, the FDC is the legal authority to register cooperatives in Nigeria. They have been very cooperative and the reform that was going on within the financial sector of the cooperative today is being initiated by the department. FDC has done quite a lot for us and we are very appreciative of that. As regards RUFIN, it is a programme in the same ministry under FDC as a vocal office of RUFIN. it has been providing support for the FDC towards ensuring that the job is effectively done. We are part of the teams engaged in the critics of the micro finance curriculum injected into the cooperative colleges of the federation, a programme sponsored by IFAD.

 Apart from this, we also benefitted from the trip out of the country with a view to seeing how we can improve on ourselves. We travelled about five countries last year under the sponsorship of IFAD-RUFIN. We felt that IFAD-RUFIN is very supportive to the cooperative but they need to know more about us and our modus operandi. As far as we are concern, we are saying any support that should come to us must tandem with the cooperative development policy of Nigeria. 

As for the CBN, we have not got any support from them. We are trying as such as possible to see that the CBN understands how cooperative works because AMNFIN which is the child brain of RUFIN and CBN as umbrella body of micro finance banks sub sector needs to know and understand what the cooperatives stand for in that body. 

CBN needs to understand that the cooperatives as a member of AMNFIN today constituted 80% of its membership and if we have a whole membership base in AMNFIN, it means we are in the bulk and we must be reckoned with in policy formulation relating to micro finance sub sector. The cooperative principle has to be strictly taken into consideration for any provision of policy for micro finance in Nigeria. As a matter of fact we are recommending that the CBN needs to engage in a programme that will update their knowledge about cooperative principle and best practices in Nigeria, so that the programme will be set to improve on the micro finance sub sector.** will be well implemented.** As a matter of fact, right now, the MSMEDF has a very low turnout. A lot of people are not getting it particularly the cooperatives. The reason is because the conditions are not cooperative friendly. And if the program is actually designed for us, it means the government must adhere to our principles. 

Let me ask this question, suppose the FG decided to give CFAN fifty million naira for distribution to its members, can you guaranty recovery of such loan from members?

Like I said earlier within our cooperatives, we have a pedigree of saving and thrifts. What it means is that our people do not just go out for loan but they also save money and loan. So we have been doing that and in this case it is not a new thing to us. That is the reason why we must be best placed in this government programme. We are ready structured in such a way the money will be recovered un-injured. So in terms of giving out the money, and taking it has been a practice with us over time. 

We have done it at primary society level which is the cooperative we know. At the secondary level which is apexes and unions. We lend money to individual cooperatives, and individual cooperative also lend to their members. In Bayelsa state, over 500 million of the MSMEDF was given to the cooperative financing Agency of Bayelsa state and it was given to their members. 

As I am talking to you the recovery is quite impressive. So we have a pedigree of giving out money to our people and ability to recover them back. As a matter of fact, cooperative is one of the organizations that have a good risk management exposure because for you to access money means you must have saved money to a certain level, and for you to take money, there must be cross guaranty here and there. Take for instance, a default by one person among a cluster of ten people given loan with nine people already paid is still assumed that the ten clusters have not paid. 

So it means there is no way loan can go bad because you have crossed guaranty. So we are advising that cooperative principle must come to play in this present administration as the most important things is that it is a group of people who have been together for quite some. They have known themselves, know where each other live and they have been doing business together. So we strongly believe that if government supports us by way of providing us with fund through direct lending to our members, it will go a long way to help our people and booster the small and medium scale economy.