The Nigeria Association of Small and Medium Enterprises (NASME) has said that many operators of Small and Medium-scale enterprises (SMEs) could not repay loans due to the harsh environment.

Mr Nerus Ekezie, Director, Membership Service and Public Relations officer of NASME, said this in an interview with newsmen in Lagos.

He said that SMEs were being challenged greatly by harsh operating environment which had made them poor debt managers.

‘‘Most SMEs are definitely not good debt managers due to various factors including inadequate human capacity, electricity, high cost of raw materials and general high cost of production.

“For this reason, their businesses are most times negatively affected.

‘’The effect of this is the inability to make profits or even break even, but many of the SMEs are highly leveraged in an unbelievable way,’’ he said.

Ekezie said that only a few SMEs had access to financial assistance to grow their businesses.

He, however, expressed regret that these financial assistance were usually with high interest rates and difficult to repay.

‘‘Loan acquisition and repayment are serious issues for most small and medium businesses in Nigeria and SMEs find it difficult to acquire loans because of the risks involved in their businesses.

‘’They are usually compelled to provide collaterals before they can be given loans and many of them do not even have properties they can tender as collateral.

‘‘The interest rates applied to these loans are too high for the SMEs; it kills their businesses.

“Instead of using the loan to guarantee the growth of the business, they are struggling to re-pay more money to their creditors as a result of interest,” Ekezie said.