AVGO.ORG

By BENNETT OGHIFO
Grassroots people identify easily with developmental banking, which is the reason they set money aside daily (Esusu) that would be used to grow their business as well as finance their families. So, it becomes a plus for them to have a private institution that provides funding for their business as well as refinance it in case there is misfortune that could prevent them from repaying their loans.
Alhaji Shuaibu Aro, born on February 2, 1960 in Abeokuta, knows how grassroots economy can suffer for lack of finance, because he had seen it happen. His baseline economics is not poisoned by too many theories from business schools because it came right from the market place where he was raised and from everyday people, who are his associates. He finances, appraises and refinances grassroots projects if there is need for it.
His new model is to provide between N2.5 million and N5 million to small and medium scale enterprises that employ up to 10 people. Aro did not attend any high-profile business school but has been able to employ his street savvy in doing good business. After his primary education between 1967 and 1972 at Methodist Primary School in Ogbe, Abeokuta, Aro proceeded to Anglican Secondary Commercial School now Anglican High School for secondary commercial education between 1972 and 1976.
He later moved to Ijebu Grammar School where he completed his school certificate education in 1979. He then studied to become a chartered secretary in the Institute of Chartered Secretaries and Administrators. He worked at the Ministry of Economic Planning, Statistic Department, Ogun State between 1979 and 1981 later to Ogun State Broadcasting Corporation before becoming an entrepreneur in 1982. He registered his first company, Aro Side Commercial Enterprises in 1984 and Arocom Motors was a division of this company. He started by procuring vehicles for sale on hire purchase. “It was based on the philosophy of what I can do for my people, reducing what is expected as their contribution, below what other people were collecting from them and this as been the system from day one,” he said.
Aro’s model of investment was fueled by his humble background. He was born and raised in a market environment in Itokun where his mother was a petty trader of herbs and medicinal ingredients. His father was an artisan, a tinsmith. This background, he said was a blessing. “I was fortunate to be exposed to hardship, inconveniences, embarrassment that common people experience, like series of human rights abuses from government officials, police and others.”
Primarily, he learned how these market and his parents managed their economic lives and it was when he decided he had to do something to alleviate their poverty status. So, in November 1990, he inaugurated a non-governmental organisation known as National Council of Traders, Technicians and Farmers Association (NCTTFA), designed as an umbrella organisation for all societies of market men and women, artisans, technicians, and farmers across the country. He was the national president between 1990 and 1999. It was the mouthpiece of the common people in the country, an advocacy organisation that fights the cause of the common people.
The situation of things at the time during the military administration, limited the organisation’s ability to achieve much, but was able to pressure governments to incorporate the wishes of members in policies and programmes. “For instance, the introduction of economic development levy and business premises registration of the Ogun State government was canceled following petitions from the organisation. I led over 5,000 people to register our protest of both policies. Markets were closed in Abeokuta and Sagamu.”
The organisation also sought to transform the lives of the people economically through partnership with the state to introduce new measurements for food stuff, supported the government in reducing the cost of food items by increasing supplies to the state, they tried to establish commodities market and led a delegation to Kano and Jigawa States to invite traders to Ogun State to boost the economy as well as provide essential commodities.
He was later appointed chairman of credit committee of Peoples Bank of Nigeria in Ogun State where he served for three years. He attended courses and seminars that trained him for his present line of work, which is wealth building in local communities, how best to organise people in the grassroots to achieve socio-economic advancement. One of the vehicles employed for this is the National Council of Patriotic Nigerian Women, (NCPNW), a women empowerment organisation, which he served as the national director general for four years after it was inaugurated in 1999. It mobilised women all over the country to get loans from banks among others to enable them compete and play their role as mothers.
All things considered, he decided to harness experience gained in all these endeavours in a new project anchored on Arocom Global Investment Limited in November 2004 and three others, Arocom Global Machendise Limited, Arocom Automobile Limited, Arocom Property Development Limited and his presently processing the registration of Arocom Micro-Finance Bank Limited that is designed to have branches across the nation. “We want our impact to be felt across the 774 local government councils of the nation. We are looking at using private sector finance initiative to improve the standard of living of the common people.”
He said Nigerians are used to relying on government for everything, and explained that government activities should be limited to government businesses like provision of infrastructure, roads, water, and electricity among others. Government, he said should provide rules and policy guidelines, stating that things ought to be done. “It is not the business of government to start giving cars or motorcycles to people, or loans because there are organisations with statutory permit to give loans, but these institutions are shying away from the grassroots people, asking for all kinds of collateral and document they cannot get. The conventional commercial banks are not really helping the situation when we talk about grassroots development and no nation can develop if the grassroots people are not taken care of. The grassroots people are in the majority in any nation and are the bedrock of the nation’s economy.”
To fill the vacuum created by these conventional financial institutions, his company decided to focus on employing private sector money in developing grassroots people, because these set of people lack access to finance. “All my companies will work towards the use of private sector finance initiatives to improve their standard of living.”
In 2005, it released 2000 motorcycles on hire purchase to school teachers with 18 months repayment plan and the package was N180 million and they paid. “Sincerely, we have touched the lives of over 50,000 salary earners across 10 states, Rivers, Lagos, Ogun, Osun, Ondo, Ekiti, Edo, among others. We supplied asserts to people with over N5 billion, and these include motorcycles, fridges, freezers, televisions, among others under our assets acquisition scheme for salary earners. We want to phase out the use of tokunbo items among our people, because we are not second class citizens.” In 2008, his company bought goods from PZ worth over N400 million, which it distributed to teachers at convenient repayment plan.
Arocom Properties Limited, he said has acquired land to build homes for grassroots people using mortgage arrangement and flexible repayment plans and this would be between 20 and 25 years. “I want to start building houses across the country and our focus is the grassroots and the philosophy is not to make extraordinary profit, but how best to assist the grassroots since there is little the government can do in this regard. They have even realised the importance of private sector partnership in development.”
The company also gives out “very soft loans from N100,000 to N2 million to individuals, who are to present themselves in groups of 25 people with the leaders, chairman, secretary and treasurer expected to sign a deed of guarantee and they are to monitor their members to ensure prompt repayment. It is interest-free, except for administrative charges.”
The company also has a business plan for small and medium enterprises to assist entrepreneurs firm up their businesses. Under this scheme, the company distributed 70 vehicles values at N55 million. The Alake of Egaland, His Royal Majesty Adedotun Gbadebo, graced the event. Hairdressers, tailors in Ogun State were given equipment, which sum he put at about N54 million. “About two weeks ago, I was at Oshodi-Isolo local government where we distributed assets and money worth over N75 million.”
He said they are working on other schemes targeted at using private sector fund to improve the socio-economic status of people in the grassroots. Beneficiaries hold regular meetings with the company’s staff, depending on the time agreed upon by both parties. “I do not have any fear of repayment because I did 25 years pilot scheme on this project before I started its implementation in 2005. I know the grassroots people and what they need. They are law abiding people, but there are special cases where beneficiaries will not be able to cope and we have a way of assisting them so that we get them settled to enable them repay.
“For instance, somebody collected N100,000 from Arocom and we later found out she was owing some people who removed all her business equipment. I invited all the parties and she was said to owe over N100,000. But after collating information it came up to N86,000 and so we gave her N200,000 to enable her pay off her debts so as to concentrate on her business and pay us back using a new repayment plan. Another lady’s shop got burnt after collecting N100,000 and we gave her additional N50,000 to reconstruct the shop and start the business over again,” Aro said. The group has various sources of funding. He said: “We have links with all the 24 commercial banks in the country as well as off-shore loans, added to what we have as a group is what we use in financing these projects.”