A popular phenomenon among many in Nigeria – commonly attributed to governance failure – is policy somersault, in which case successive governments revoke policies of their predecessors. AGSMEIS did not fail as a result of policy somersault. Experientially, Kachi Ogbonna had much to share as he pointed out that Nigeria’s core governance challenge has rarely been poor policy design. From the First Republic to the present day, the country has produced numerous well-thought-out development strategies. The recurring problem has been implementation.
Explaining how the process broke down, Ogbonna noted that, despite the protective layers built into AGSMEIS, determined actors across different levels found ways to exploit the system. One is through EDI bypass attempts. “The first point of breakdown occurred at the EDI level. Because many applicants were uninterested in training, they attempted to bribe their way to certificates. They viewed business knowledge as irrelevant, believing the loan itself was all they needed. This attitude weakened the integrity of the programme and undermined its purpose.”
Another is the diversion at the institutional level. He was more direct on the conduct of officials involved in the handling of the project. He disclosed that, “more critically, allegations of large-scale diversion of funds soon plagued the programme. High-ranking officials within NIRSAL and CBN reportedly colluded with political actors to misappropriate significant portions of the funds meant for entrepreneurs. Public reports and investigations over the years have highlighted misuse and corruption involving senior officials, including accusations against former NIRSAL executives. While the specifics are subjects of on-going legal and administrative processes, the perception — and in many documented cases, the evidence — strongly suggests that a substantial percentage of AGSMEIS funds never reached genuine beneficiaries.”
Pervasive lobbying and kickback culture contributed significantly to killing AGSMEIS. As access to the loan became more difficult — sometimes with only a fraction of applicants receiving approval, a market for influence quickly emerged, Ogbonna noted. “Applicants began negotiating with EDIs, proposing percentages of their potential loan in exchange for help “pushing” their applications. In some EDIs, officials themselves allegedly demanded kickbacks, in some cases as high as 50 percent of the approved amount. This practice created yet another barrier for honest entrepreneurs and further eroded trust in the process.”
Vendor–beneficiary collusion was rife. For the few whose loans were approved, a new form of exploitation emerged at the vendor level. Some beneficiaries, uninterested in actually acquiring equipment, approached vendors proposing illicit cash exchanges. Vendors, having allegedly paid to secure their accreditation, often demanded a large percentage of the disbursed funds in exchange for forwarding the remainder to the applicant.
According to Ogbonna, a typical negotiation might begin with a vendor refusing outright to release funds, insisting on adherence to CBN policy, but eventually shifting to a profit-sharing bargaining process. Applicants often ended up receiving only a portion of the equipment funds while the vendor pocketed the difference. In many cases, the proceeds were then channelled into unrelated ventures like POS businesses or building projects — enterprises far removed from the proposals that justified the loan.
These sharp practices constitute a strong reason for a reflection on Nigeria’s governance crisis as experiences like these raise difficult but necessary questions. How can Nigeria develop sustainably when well-designed policies are routinely sabotaged by the very people meant to benefit from them, as well as by those tasked with implementing them? Is the problem primarily the political leadership, or is it a more systemic issue involving citizens, institutions and cultural attitudes toward public resources?
The uncomfortable truth is that both the rulers and the ruled bear responsibility. While corruption at the top siphons off enormous sums, everyday citizens also participate in and normalise corrupt practices — sometimes viewing them as survival strategies rather than ethical breaches. This creates a cycle in which good policies fail, public trust erodes, and the country’s progress stalls.
There should be a way forward. Let us acknowledge and agree that Nigeria’s development challenge is ultimately rooted in the failure of systems. Policies can be brilliant, but if institutions lack accountability, transparency and the capacity to enforce rules, implementation will continue to falter. Strengthening institutions, especially through digital monitoring, independent audits and transparent reporting is essential. Equally important is a cultural shift. Citizens must recognise that public resources are collective assets, not opportunities for personal gain. Until there is both institutional discipline and societal rejection of corrupt practices, programmes like AGSMEIS will continue to fall short of their potential.
This account reflects real events that occur daily across Nigeria’s governance landscape. And unless the country confronts these structural and behavioural problems, even the best-designed policies will continue to fail.
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Kelechi C. Udochukwu is a fintech analyst who has worked in retail, investment and microfinance banking institutions. He has over 30 years managerial experience. Send feedback and responses to comment@businessamlive.com
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