The Nigerian Export-Import Bank (NEXIM) represents a new era of hope with regards to its financial inclusion programmes and innovation. These involve the enhancement of corporate organizations, as well as the Small and Medium Enterprises (SMEs) to export, thereby preparing the country for prosperity growth, with the power to transform citizens’ lives for the better. These are happening under the watch of Mallam Abba Bello, Managing Director/CEO NEXIM Bank.
Abba Bello fits into Gregory Clark’s visionary personality. Clark, a professor of economics at the University of California – Davis, who specializes in analyzing the long-term growth and wealth of nations, made some valid points in his 2007 book A Farewell to Alms, A Brief Economic History of the World. He reiterates that the wealth of nations and their success in achieving economic progress and prosperity depend greatly on the principle of competitiveness and equal opportunities through flexible laws that can boost the development of economic activities in various sectors.
Therefore, it is imperative for visionary leaders of institutions as well as governments to provide the necessary funding for entrepreneurs and youth aspiring to improve their economic situation, through developing a spectrum of SME financing programs. These will lead to more job opportunities, increased income and higher demand, leading to effective and sustainable growth that contributes to changing people’s lives for the better. Abba Bello’s activities at NEXIM Bank relate to a charting of path towards all these.
Bello was appointed into office in April 2017, and ever since then Bello has been showcasing excellence in practices and putting on ground some innovations at NEXIM Bank. These activities have made the bank more visible to the public, making NEXIM image to go beyond the perception of mere trade facilitation between Nigeria and the outside world to an institution whose touch is seen in several aspects of the Nigerian economy, banking, transportation , education, environment and others.
He is an insightful, multifaceted personality, who enthusiastically embodies the corporate values of NEXIM;, an extremely wise, meticulous person, who has a flair for helping entrepreneurship grow and international trade bigger. He solid administrative acumen that few people have from the beginning, which helps him better able to relate with business people as they grow, providing them useful advice to build a business empire.
As part of his insightful nature, he thought it wise to help support crucial decisions related to a major infrastructure and economic development effort – the Sealink Project. According to NEXIM website, the institution is facilitating the establishment of a regional maritime transnational company (the Sealink Project) in collaboration with the Organized Private Sector under the auspices of the Federation of West African Chambers of Commerce and Industry (FEWACCI). The proposed Sealink Project is aimed at mitigating current non-tariff barriers and high logistics costs that has hindered the growth of intra-regional trade and competitiveness of Nigerian manufactured exports regionally.
Of course, the Sealink Project is said to be essentially conceived as a Public Private Partnership initiative to be managed by the private sector. “The Sealink is about to commence a pilot run of its services and is engaging with potential customers for service offtake, especially for bulk cargo in West and Central Africa, and is working with the National Inland Waterways Authority (NIWA) on collaborative partnership (between NIWA, NEXIM and Sealink) to undertake a joint survey of the lower Niger river, with a view to promote the use of Nigerian inland waterways for moving bulk cargo.” Says the report on NEXIM’s website.
Another great initiative from NEXIM Bank comes in the area of enhancement of human capital development in Nigeria as its own form of corporate social responsibility. The presence of Bello as CEO has given impetus to NEXIM in this regard. The Bank under its Corporate Social Responsibility Programmes is committed towards supporting structures and initiatives across diverse areas of healthcare, education, sports, environment, human capital development and the Arts.
Its CSR initiative embodies an ardent commitment and social pact with all the stakeholders. Thus, the bank is committed to creating enduring partnerships for sustainable development whilst adding immense value to its diverse beneficiaries and stakeholders.
It was reported that in 2019, NEXIM Bank engaged and reached out to various entities by promoting skills development and acquisition, supporting small and medium scale enterprises, sports and educational development, healthcare management, sponsorship and support to Associations, and Disadvantaged groups.
Apart from brilliant initiatives, Bello also came out with an innovation to solve financing problems for even small and medium enterprises. This has to do with the introduction of factoring system into the Nigeria business landscape. This is to help business solve some financing issues.to do this, NEXIM bank, under the auspices of FSS 2020 is collaborating with the African Export-Import Bank (Afreximbank) and the Factor Chain International (FCI) to develop and implement a legal framework for Factoring in Nigeria.
According to reports, the Draft bill on this has been developed and is undergoing legislative processes following which it is expected to be passed into law towards promoting a legal/regulatory environment for factoring. This will help integrate Nigeria into the global factoring market
Factoring is a financing method in which a business owner sells accounts receivable at a discount to a third-party funding source to raise capital. Factoring is very common in certain industries, such as plank trade, and the clothing industry, where long receivables are part of the business cycle.
In a typical factoring arrangement, the client (you) makes a sale, delivers the product or service and generates an invoice. The factor (the funding source) buys the right to collect on that invoice by agreeing to pay you the invoice’s face value less a discount–typically 2 to 6 percent. The factor pays 75 percent to 80 percent of the face value immediately and forwards the remainder (less the discount) when your customer pays.
Because factors extend credit not to their clients but to their clients’ customers, they are more concerned about the customers’ ability to pay than the client’s financial status. That means a company with creditworthy customers may be able to factor even if it can’t qualify for a loan.
Three misconceptions that need being corrected about factoring: First, factoring is not a loan; it does not create a liability on the balance sheet or encumber assets. It is the sale of an asset–in this case, the invoice.
Second, some consider factoring to be one of the most expensive forms of financing, but that is not always true. Yes, when you compare the discount rate factors charge against the interest rate banks charge, factoring costs more. But if you can’t qualify for a loan, it doesn’t matter what the interest rate is. Factors also provide services banks do not: They typically take over a significant portion of the accounting work for their clients, help with credit checks, and generate financial reports to let you know where you stand.
Third, the idea that factoring is a last-ditch effort by companies about to go under is another misperception., and analysts say the opposite is true: “Most of the businesses that factors deal with are very much in an upward cycle, going through extremely rapid growth.”
As a business man if your company regularly generates commercial invoices but your clients are not paying on time, you could benefit from reducing the time receivables are outstanding. Factoring may provide the cash you need to fund growth or to take advantage of early-payment discounts suppliers offer.
Factoring is a short-term solution; most companies factor for two years or less. Analysts say the factor’s role is to help clients make the transition to traditional financing. And with what NEXIM is trying to do, your banker may be able to refer you to a factor. Shop around for someone who understands your industry, can customize a service package for you, and has the financial resources you need. As an alternative trade finance instrument, Factoring is expected to promote financial inclusion and enhance the contributions of the Small and Medium Enterprises to exports, thereby reducing the incidents of informal trade.
But then who is Abba Bello ? Why has he able to introduce innovations at NEXIM Bank?
A kind of man who has devoted his working life to serve the nation and support people. Through NEXIM Bank, his ambition is to create more and more jobs by extending finances to entrepreneurs. Bello has exemplary work ethics and commitment to the nation.
With decades of experience in serving the private sector, he is the right one needed to stir the ship at NEXIM Bank where he is leading Government mandate to promote trade, productivity and growth and do everything needful to deliver trusted practical solutions to enable impactful government actions and transformation in regards to helping local businesses find their footing in the waters of global competitiveness.
Mr Abba Bello has 28 years’ experience in banking, where he has held senior management positions in corporate banking, regional and commercial banking, and public sector banking in more than a decade. Abba also had a brief stint in auditing. Abba has cognate experience in international banking. He was the pioneer Managing Director/CEO of United Bank for Africa Plc’s subsidiaries in the Republic of Chad and Zambia for several years.
Abba has attended several courses in Nigeria and abroad in leadership, advanced management, and executive management. He is a member of Chartered Institute of Bankers Nigeria, and a Fellow, Institute of Credit Administration.
Prior to being appointed to head NEXIM Bank, Bello was Executive Director, Unity Bank Plc, in charge of Corporate Banking, Agriculture and North Directorate until he was appointed as Managing Director and Chief Executive Officer of Nigerian Export-Import Bank in April 2017. This wealth of experience he deploys to run NEXIM and to enhance policy development, strategic planning programme and financial management, operations, auditing, deployment of technology and innovation.
Under Bello’s watch, NEXIM consistently attracts recognition to excellence in its core banking functions to facilitate international trade environment, with contributions to social, governance, and to sustainable development
The staff share a rigorous method when it comes to building and managing a sustainable operation. Their boards set strict standards and clear goals on ESG (Environment, Social and Governance), as well as measure and monitor their progress towards meeting them. Their corporate culture places an uncompromising emphasis on ethics, productivity and is characterized by a strong drive to reach out to stakeholders and to promoting transparent reporting.
The actions of its board and its management have impacted the country in many ways. They have shown to business men- importers and exporters, how to truly build a company with purpose, where every corporate action zeroes in on crucial goals around people, the planet and its products.
Through its self-imposed mandate of being instrumental in promoting financial inclusion for businesses and sustainable development in the country, NEXIM under the watch of Bello is helping Nigeria advance the pace of business in order to achieve inclusive prosperity and favourable of trade and balance of payment.
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