RTEAN Ogun asks FG to create Bank of Transportation with 4% to 9% loans

The Ogun State chapter of the Road Transport Employers Association of Nigeria (RTEAN) has asked the Federal Government to establish a Bank of Transportation that will give road transport operators affordable loans. The association made the call on Tuesday at its secretariat in Abeokuta, Ogun State.

RTEAN State Secretary Aare Tiwalade Akingbade said the proposed bank should lend at interest rates of between 4% and 9%. He said the money would help operators buy vehicles, expand their businesses and improve service delivery.

Why operators want a dedicated bank

Akingbade said ordinary bank lending rates of about 25% make it hard for transport operators to repay loans and stay profitable. He questioned why road transport operators should borrow at rates comparable to those charged to sectors such as oil and gas.

“If you are in the road transportation business and have to obtain loans from the same financial institutions that lend to operators in sectors such as oil and gas, at interest rates of 25%, how do you expect to repay such loans and remain profitable?” he asked.

He said RTEAN had submitted several proposals to the Federal Government and hoped they would be considered, especially the plan for a dedicated financial institution for transportation. He stressed that the association was not asking for free money.

“We are not asking for free money. All we are asking for is a dedicated platform that will give transportation operators access to loans at affordable, single-digit interest rates of between four and nine per cent,” Akingbade said.

He added that an efficient, reliable and affordable transport system is essential to economic development. Road transport, he said, connects passengers to other modes of transportation, including rail, water and air.

20 members complete conflict resolution training

In a related development, 20 members of the Ogun State chapter of RTEAN received certificates after completing a three-day conflict resolution training programme. The training was organised in collaboration with the Federal University of Agriculture, Abeokuta (FUNAAB).

The programme was facilitated through FUNAAB’s Institute of Communication and General Studies under its Peace and Development Studies Programme. The certificates were presented at Tuesday’s meeting by the association’s Deputy Chairman (Administration), Otunba Segun Johnson, on behalf of the State Chairman, Alhaji Akibu Titilayo Efele.

Akingbade said the training was designed to help members resolve disputes, improve their relationships with passengers and manage their responsibilities as transport operators and employers. He added that participants could further their education through advanced certificate and diploma programmes in conflict resolution.

The association also screened more than 100 people during a medical exercise.

What it means for operators

The request comes as borrowing costs remain a major concern for Nigerian businesses. The Central Bank of Nigeria cut the interest rate by 50 basis points to 26.50% from 27% at its 304th Monetary Policy Committee meeting. CBN Governor Olayemi Cardoso said all members of the committee unanimously agreed on the decision.

For road transport operators, cheaper credit could make vehicle acquisition and fleet expansion easier. But the Bank of Transportation is still a proposal, and no timeline has been given for its establishment.