Why Nigerian Banks charge high interest rates – Wigwe

Managing Director of Access Bank Plc, Mr. Herbert Wigwe has opened up on factors fueling the observed rise in lending interest rates amongst Nigerian banks.
Speaking recently at the just concluded seventh German-Nigerian Business Forum in Lagos, Wigwe said that once some structural problems in the country are addressed, the amount of interest rates being charged by banks would reduce.
According to him, “To resolve the high interest rate issue, we need to resolve some inherent cost issues. We need to bring down the cost of power and look at infrastructure. Resolving power alone can bring down our cost of production by 40 per cent, once those variables are resolved in the economy, interest rate and inflation will come down.
“We also need to focus inward; there is no need for us to import things. So, if we basically consume what is produced in Nigeria, what you see is that all of these variables would downwards, the government has started but it will take a while for some of these things to mature,’ he said.
He revealed that his bank has set new record with German Business Desk, a newly set up business development platform driven by the Nigeria-German bilateral trade by registering more than 20 new businesses since the platform was created in 2017.
He noted that out of about 85 to 90 German corporates doing strong business in Nigeria, over 20 are registered on the platform.
Wigwe further explained that “What the German desk was set up to do is to put Nigerian businessmen, who seek to do business in Germany or buy German products in touch with their German counterpart. It also puts German businessmen in touch with their appropriate Nigerian businessmen. It provides financing at affordable rate to both parties to consummate their business.
He stressed that “We ensure that whoever brings capital and whatever bundle we provide can basically take it out. We have responsible business people working together to create value for the country,” and further advised Nigerians to patronise locally made goods and services to grow the economy, pointing out that strong appetite for foreign made goods in the country leads to imported inflation.