In order to encourage Nigerians buy made in
Nigeria cars as well as own brand new cars,
The Federal Government has concluded all
necessary plans to launch an automotive credit
purchase scheme latest by next month, a
scheme that will offer Nigerians an opportunity
to pay for purchased vehicles over a period of
time as obtained in other countries..
The Minister of Industry, Trade and Investment
Olusegun Aganga made the disclosure on the
side-lines of the 69th United Nations General
Assembly, in New York recently.. “In England if
you enter a house, you see beautiful furniture
and all that most of it is on credit. So we are
saying we want to come up with credit
purchase scheme whereby rather than buy
that N800,000 used car, you buy a new N1.5
million car, you pay over four years at interest
rate that you can afford. That is what National
Automotive Council (NAC) is using that levy for,
to work with banks so that you can be assisted
to buy a new car. We hope to launch that very
soon. So when you come with any new policy
you have to think through, what do I need to
do‎ to make it work and ensure that there
are things already in place to make it work” he
said. “Why would anyone say is hasty? We had
auto strategy 30 years ago when Peugeot came
into the country we killed it and we are
resuscitating it. ‎Now you said we are in a
hurry when nothing happened in 30 years?.
“The way to look at it is that it is going to
happen any ways whether it is today, five
years time. So that is not the issue, the issue is
what is government doing and how are we
trying to solve the problem. Is government
aware? The answer is yes. That is why in every
country where they have introduced auto
policy, they banned importation of used cars
immediately because if you don’t ban used
cars most people will not buy new cars
therefore there is no market for investors to
come in. In every country they banned it but
in Nigeria we have not banned it. Secondly, the
duty should be 35 per cent, levy 35 per cent
but we said for used cars we keep it at 35 per
cent, we have not introduced the levy until we
feel the condition is right. We had waved it
until December and December we halved it for
another six months. That is the second thing
we are doing.. “The third thing that is
important that we are also doing is the fact
that we said for this to work, government must
do two things. Encourage those coming to
assemble affordable cars. That is why today
you hear Nissan said they have cars for N1.5
million or N1.6 million. Fourthly, we will
encourage banks to set up credit finance
schemes. The reason you are spending,
800,000 to buy car is not because you want to
buy a used car that you may spend a lot of
money maintaining because you are required
to pay cash. Nobody anywhere in the world
pays cash for this sort of thing,' he said..

m.thenigerianvoice.com/mobile/158405/1/fg-to-launch-federal-auto-mortgage-scheme-in-octob.html

I wonder why this wonderful thread has not made front page..
I was FTC but my post was locked....

This is nice....

But i'm sure only government workers would benefit from the scheme, since their jobs are more stable....

Lagusta:
This is nice....

But i'm sure only government workers would benefit from the scheme, since their jobs are more stable....

Not necessarily! If the mortgage agents will work with banks, people working in the private sector can benefit too...

Coldplay007:

Not necessarily! If the mortgage agents will work with banks, people working in the private sector can benefit too...

now what if the following ensues:

1) a worker loses his job

2) the company liquidates

and the worker/company buys the cars on mortgage, what could be done to avoid embarrassment

Lagusta:


now what if the following ensues:

1) a worker loses his job

2) the company liquidates

and the worker/company buys the cars on mortgage, what could be done to avoid embarrassment

1. People who work in private firms actually buy cars with credit facilities.. if he loses his job, the bank reclaims the car.. When you default in payment for any reason whatsoever, the bank reclaims the car, that's why u have to make a down payment of a percentage of the cost, this will ensure that if for any reason you default, they would have a tidy percentage of the cost so selling the reclaimed car will offset the rest..
2. The bank always retrieve their money, they can go as far as getting you a job so u will be able to pay back.. or they just reclaim the car...

Most big companies already have auto policies and can help you get financing for your car. You can even go to the bank directly, what this policy does though is that it reduces the interest rate and increases the time you have to pay back the loan.

This Aganga fellow self is not the type that should be running a ministry.

He is coming out with policies without input from stake holders or industry insiders.

It is not for the government to give out auto loans the banks should be doing it if it was a viable business.

Mortgage means a property loan, when something that appreciates like a house is not a priority finance program by the government why is a car loan that depreciates in value such a thing they can roll out in months.

The government should not be dictating to industries but facilitate enabling environment for all parties both manufacturers and consumers.

In an industry where there is no manufacturer the consumers are a priority instead of being used as cash cow'

N200k duty on all used cars over the years where is that money going.

The last time they scrapped the NAC they shared the generated money between some companies with no result.

In my opinion.
This policy doesn't make any sense.
The type of used car you buy for say 800,000k cannot be gotten 1.5M new.

Interest rates in UK is less than 1%. Almost 30% in Nigeria.

Government make a lot of money from duties on used cars imports

People are employed as car dealers, clearing agents, parts sellers and mechanics etc.

Newly manufactured cars are getting frequent recalls these days. So people even prefare a car that has been used for like 2 years, instead of a brand new.

The new cars assembled or made in Nigeria will definitely not meet upto standard abroad cos of Nigerias high operating costs.

Making cars locally is very good. Instead of trying to force it like they are doing now, Government should create the environment, investors are smart, they want to make money they will come on their own. People prefare a new car to used car. They will buy new cars.

October is halfway, where is the auto mortgage?

Please stop using the word mortgage to describe an auto loan.

Besides who wants to take a "death pledge" loan on a motor vehicle in Nigeria?