The Centre for the Promotion of Private Enterprise (CPPE) has urged the Central Bank of Nigeria (CBN) to relax its monetary policy stance to improve credit access for small and medium enterprises (SMEs) and critical sectors of the economy.
In a policy advisory issued Sunday, CPPE Chief Executive Officer, Dr. Muda Yusuf, called for a review of the Cash Reserve Ratio (CRR) and Monetary Policy Rate (MPR), noting that inflationary pressures have begun to moderate.
He argued that while the CBN’s tight monetary posture was designed to curb inflation, it has restricted access to affordable credit for businesses and households. Yusuf recommended complementary supply-side measures to tackle structural inflation drivers alongside monetary adjustments.
“Calibrate CRR and MPR downward as inflation moderates to create a more enabling credit environment. Complement monetary tightening with supply-side measures to address structural inflation drivers,” he stated.
CPPE further called for credit guarantee schemes and concessionary financing tailored to SMEs, agriculture, manufacturing, and renewable energy, stressing their role in economic resilience. It also proposed development finance instruments and a deeper domestic bond market to mobilize long-term funds for infrastructure.
The group commended CBN Governor Yemi Cardoso for reforms that improved transparency, credibility, and stability in the financial system. It highlighted foreign exchange market unification as a key milestone that reduced arbitrage and restored confidence.
At its 301st Monetary Policy Committee (MPC) meeting in July, the CBN retained the MPR at 27.5%, with all 12 members voting unanimously. Analysts, however, anticipate a potential cut of 25 to 50 basis points at the next MPC meeting, citing easing inflation, naira stability, and global monetary shifts.
