MHR ADEFARATI PROPOSES AN URGENT MOTION CALLING FOR IMMEDIATE ACTION ON THE DISPROPORTIONATE BALANCE BETWEEN BANKING SECTOR PROFITS AND REAL ECONOMIC GROWTH
MHR ADEFARATI DELIVERS A MOTION ON THE URGENT NEED TO ADDRESS THE DISPROPORTIONATE BALANCE BETWEEN BANKING SECTOR PROFITS AND REAL ECONOMIC GROWTH
The House Note that the latest financial reports reveal that most Nigeria’s tier-one banks have posted unprecedented post-tax profits exceeding ₦1 trillion, while many sectors of the economy, especially agriculture and manufacturing, struggle to grow;
Also note that the shift in focus by banks towards generating income from fees and commissions has led to increased costs for consumers and limited access to affordable credit for small businesses, crippling their ability to thrive and contribute to the economy. Concerned that the exorbitant interest rates charged by banks, often exceeding 35%, pose a significant barrier for entrepreneurs, particularly those in the agricultural sector, limiting their access to essential funding;
Further note that the prevalent issue of casualization among bank workers, with reports indicating that many banking staff in Nigeria are employed under casual terms, undermines job security and worker welfare, despite the substantial profits reported by the banking sector. Concerned that this practice not only affects employee morale and productivity but also impacts the overall economic stability and social equity, reducing long-term career growth opportunities for many Nigerians.
Further note that the neglect of lending to critical productive sectors contributes to low productivity levels, thereby adversely impacting our national food security and economic resilience;
Resolves to;
Customer Protection Measures: Request the Central Bank of Nigeria (CBN) to enforce fair and transparent bank fees. Enforce the cap bank commissions to prevent exploitative practices.
Productive Sector Funding: Further mandate banks to allocate a percentage of their profits to lending to productive sectors like manufacturing and small businesses.
Strengthening Agricultural Financing: Establish more agriculture financing funds supported by government and private sectors to complement the existing ones. Implement subsidized interest rates on agricultural loans.
Employment Standards and Worker Protection: Collaborate with the CBN and Ministry of Labour to reduce casual employment, advocating for permanent employment. Impose penalties for non-compliance with employment standards to foster stability. Refer this motion to the relevant Committees on Banking, Labour Employment and Productivity, Industry, and Agriculture to ensure swift implementation, benefiting all Nigerians.
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