President Mohammadu Buhari-led government is set to commence a policy that will encourage loans to be offered to Nigerians who are interested in buying made-in-Nigeria cars.
The loans will be offered at a 6% -8% interest rate. The repayment period for the loans will span several years.
This measure is to encourage the purchase of made in Nigeria vehicles as a way of boosting local production in the country.
This was recently revealed by the Director General of the National Automotive Design and Development Council ( NADDC ), Jelani Aliyu in an interactive session with pressmen.
According to Aliyu, the policy was aimed at discouraging importation of vehicles into Nigeria.
Aliyu noted that giving access to vehicle financing was an important step forwards supporting the capacity of local manufacturers in the country.
” In other nations when you want to buy a vehicle, you go, you put down 10% to 15%, you drive off with the vehicle and you pay for it for a number of years at just 6% interest rate, but that is non-existence in Nigeria “.
Aliyu lamented that ” when you have vehicle financing system with an interest rate of about 20%, it is high”. Adding that the Council had concluded plans with three indigenous banks to enable access to vehicle financing at a low-interest rate.
“We have funding, we are going to be working with this, we are talking with three banks, we will soon be rolling out what we call the Automotive Vehicle Finance Scheme”.
Jelani however said the access to the finance will only be provided for vehicles that were manufactured in Nigeria. ” in about a month and half, we will roll out the vehicle finance scheme so that Nigerians will be able to put in maybe 10% or less and drive off with the vehicle and pay over a couple of years at just 6-8% interest rate.
” We really think this will improve local capacity for production of vehicles in the country and these finances were for only made in Nigeria vehicles ” he noted.
He said that the country was spending over $8 billion on the importation of vehicles and other automotive related products. “That is $8 billion that simply goes out of our economy to purchase 300-400 vehicles per year.
“Most of these vehicles are used so there is a lot of challenges with efficiency, safety, not to talk of zero contribution into our economy”.