Business
Recapitalisation: Insurers Shop For N200bn
No less than N77billion would be taken away from insurance industry by government agencies to realise the expected injection of an additional N200billion into the industry in the cause of the ongoing recapitalisation exercise, a recent report has revealed.
According to the report, the recapitalisation cost was drawn from fees to be paid to the Nigerian Securities and Exchange Commission (SEC), tax and stamp duties to be paid to the Federal Inland Revenue Service (FIRS), among other fees.
The Accounting Committee of the Nigeria Insurers Association (NIA) that did the costing of individual insurance companies’ recapitalisation expenses put the total amount at N77 billion for the 58 existing companies. Also noted is that companies offering composite business that requires N18 billion minimum capital are the worst hit, as some could have to cough out about N5 billion each to raise the N18 billion.
Although, the National Insurance Commission (NAICOM) had pledged to discuss palliatives with its counterpart agencies, the Securities and Exchange Commission, NSE, and FIRS, no commitment has, so far been made by any of them.
For instance, at the Insurance Sector Forum organised by the Nigerian Stock Exchange in Lagos recently, the SEC had recently denied the claim by NAICOM that a letter requesting for financial palliatives and waivers has been submitted to the Commission.
According to, Head of Department, Securities and Investment, Mr Abdulkadir Abbass who represented Mrs Mary Uduk, the Ag DG of SEC, the Commission had not received any request for waiver on recapitalisation or palliatives from the NAICOM.
But Mr Pius Agboola, Director, who represented , the Acting Commissioner for Insurance, NAICOM, Mr Sunday Thomas during the question and answer session, had said that his commission had already submitted a letter to that effect to SEC.
Mr Agboola had, however, admitted that the letter was given to Mr Abbass’ driver for onwards delivery to the Commission and whether the letter was submitted or not was unknown.
He pledged to resend a fresh letter to SEC for them to step up action.
However, , Director General, NSE, Mr Oscar Onyema at the Forum themed; Recapitalisation: A panacea for Insurance Industry Growth” had called for support of the insurance industry’s stakeholders for companies seeking to raise capital in the market, adding that insurance needs support to realise its potentials.
The facility will be disbursed through participating Microfinance Institutions (MFIs), which will in turn extend the loans to their customers, particularly SMEs, as they directly interface with businesses at the grassroots level.
The Executive Director of COMCIN, Mr. Micheal Ogbaa who represented the Chairman, Dr. Iredele Oyedele (FCA, FCCA), said the initiative is designed to strengthen micro-lending institutions and expand access to finance for grassroots entrepreneurs, particularly women and youths in the informal sector.
Ogbaa explained that COMCIN does not lend directly to individuals but works through its network of microfinance and cooperative institutions, which in turn provide loans to end users.
“We came together to advocate for the microfinance ecosystem. Commercial banks often exclude people at the grassroots, but our members are positioned to reach them. This facility will empower them to do more,” he said.
He noted that the loan scheme offers low interest rates and flexible repayment plans, making it more accessible to small business owners.
According to him, about 90 percent of beneficiaries are expected to be women, who play a key role in sustaining families and driving economic activities at the local level.
“Our focus is on traders, service providers, and players in the informal sector. These are the real movers of the economy. By supporting them, we are strengthening families and contributing to national development,” he added.
Ogbaa disclosed that eligible SMEs with proven integrity and business track records could access up to N5 million each through participating micro-lending institutions. The rollout has commenced in Lagos and will extend to Abuja, Enugu, and other regions, including the South-West, South-East, and North-East.
He said 12 micro-lending institutions have already benefited from the scheme, while 85 applications are currently being processed under the pilot phase.
“Our target is to reach at least 100,000 SMEs nationwide. We are building a platform that connects funding partners with credible micro-lending institutions, creating a reliable channel for financial inclusion,” Ogbaa said.
He added that COMCIN is also working to attract larger funding pools from development finance institutions and private investors, noting that successful implementation of the pilot phase would boost confidence and unlock more capital for SMEs.
“We have seen encouraging testimonies from early beneficiaries. As we demonstrate transparency and efficiency, more institutions will be willing to channel funds through us,” he said.
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