Creating small businesses, employment with social intervention
It is obvious that millions of Micro, Small and Medium Enterprises (MSMEs) typically struggle with the necessary business capital required to fund all of their projects, survive, as well as engage more hands in running their operations.
Barely nine months into the launch of Lagos State Employment Trust Fund Loan Scheme (LSETF), there are some compelling reasons to believe that the scheme has started creating empowerment for youths, through entrepreneurship and employment opportunities.
The LSETF, like a social intervention, backed by a 2016 Act, was established to provide financial empowerment for MSMEs, inspire the creative and innovative energies of entrepreneurs resident in Lagos and reduce unemployment across the state.
The Fund has a strategic target to create and sustain 300,000 direct and up to 600,000 indirect jobs by 2019 and provide loans to at least 100,000 MSMEs by 2019, with a N25 billion seed capital from the state government. So far, LSETF records shows that over 4000 businesses resident in Lagos have been empowered.
Andrea Akintoye, best known as the “Louis Vuitton” of cake makers, founded an emerging leading cake company popularly known as Cakes by Andy Clark. The company specialises in producing great tasting, custom-made wedding and celebration cakes, cupcakes and desserts. She is a recipient of the Fund.
Now, Akintoye would readily say to anyone who cares to listen that “one of the most amazing things that happened to me this year was getting a loan from Lagos State.”
“My friend, Omilola, was the one who told me about the scheme and encouraged me to apply. I was a little bit scared but I applied. In fact, I missed my deadlines twice. Amazingly, my application was successful and I was invited to come for an interview a week later.
“The whole process was super easy right up till when I was handed the cheque. The repayment plan is easy and straightforward. For my loan, I have to pay a small amount every month for three years, which is not bad. We also get training sessions and sometimes they call you to check up on your progress”, she added.
Jand 2 Gidi is a logistics company, in Lekki, Lagos, that specialises in the provision of international inbound and outbound shopping logistics services and founded in 2013, by Ujama Kalando-Akpata and Kikelomo Fola-Ogunniya.
This year, the small-scale operator emerged one of the first set of businesses to benefit from the LSETF loan scheme and has expanded operations to Abuja and Port Harcourt.
Speaking on the challenges faced by Jand 2 Gidi which led to the loan application, Co-founder, Jand 2 Gidi, Fola-Ogunniya, said: “Our foundation is built on excellent customer service provision but we initially started without a bike, and as time went on we were able to expand to four bikes.
“However, due to an increase in clients’ demand we had to begin offering our “Gidi 2 Gidi” –within Lagos delivery- services on ‘Book today, for tomorrow’ basis.
“We realised that this hindered us from meeting the immediate needs of our clients so the need to increase our fleet became urgent.
“The funds received from the LSETF has made the growth in our business possible. We are now able to offer same day delivery services at various times during the day,” she said.
Justus Oboye, is the Chief Executive Officer of Lagos-based Timbolo Auto Care, an integrated automobile service provider offering part sales, repairs and restoration, warranty plan, among others.
The company, in February 2017, received a loan from the LSETF, after learning about the scheme from FATE Foundation, an entrepreneurship training and mentoring organisation.
Obaoye said: “We applied for the fund with lots of doubts but to our surprise, we got a call for an interview a few weeks later, and the fund was disbursed as promised”.
The fund has helped us in the expansion project, as we have already set up a well-equipped automobile workshop that has repositioned us to serve more corporate clients. We have also benefited from business support services in form of trainings services on various business aspects.
“When compared to the previous year, our corporate clientele base has doubled and our revenue has increased significantly with more business visibility.
“Very importantly we have expanded the team’s workforce as the business has been able to hire new full-time and contract staff for its operations.
Now a fast growing bakery- Nuts About Cakes, located in Lekki Phase I and established in 2010 by Nike Majekodunmi, was one of the earliest beneficiaries of LSETF scheme.
Majekodunmi, in an interview, said she learnt about LSETF through the newspapers and got serious with it when the state’s Governor, Akinwunmi Ambode, finally commissioned it.
Affirming an easy process from application to disbursements, Majekodunmi said the business has changed significantly after getting the loan, as there are now additional branches with new communities we serve our products.
“The scheme is revolutionary. It breaks a barrier that a lot of small and medium businesses encounter when starting and growing, by providing the funds to be able to actualise a dream and create jobs for our unemployed in the process.
“Ordinarily, someone seeking a loan would have to go to a bank that will ask for land collateral that SMEs might most probably not have. Or, they will be forced to take high percentage loans that will cripple the business before it has had a chance to succeed. The LSETF provides quick decision and affordable loans,” she said.
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