requirements include raising and depositing N250,000 as collateral before getting loans. They make accessing funds very difficult. Further, the maximum loan amount offered to MFIs by lending institutions tends to be too low to start a business. For instance, community banks give less than N500,000 in loans. Stakeholders therefore called on government to increase the ceiling. 555. The government decided that all commercial banks should provide 10 per cent of their profits after tax to help finance SMEs. About N40 billion had been raised by 2006. However, the CSAR reports that only 40 per cent of the N40 billion has been used. This issue was raised by the CRM. The major reason given was lack of collateral to satisfy the banks. Fears were also expressed that the MFIs are not managed well. Cases of corruption are cited in accessing loans. There are also delays and high costs, including interest rates, when accessing funds. 556. Stakeholders also noted that there has not been an appreciable decline in the gap between the lending and savings (deposit) interest rates after banks were consolidated. This undermines financial intermediation. Indeed, the gap between the savings deposit rate and the maximum lending rate declined only marginally from 15.41 per cent to 15.1 per cent between December 2006 and December 2007. 557. Bank capitalisation has been achieved largely by selling shares on the stock market. Pension funds and insurance funds were leading subscribers to the stock market. Stakeholders expressed concern about the inordinate amount of time it takes to obtain share certificates after buying bank shares. Further, these shares tend to be oversubscribed so that buyers often have their funds returned after buying the shares. 558. With regard to the impact of the banking system on the rest of the economy, especially the nonoil sector, the CRM concurred with stakeholders and the CSAR that the role of the banking subsector in agriculture and rural development was weak. This implies suboptimal financing of agricultural development and of small and medium industries (SMIs), which are critical for economic growth and development. Given the pervasive role that revenue from oil exports plays in the economy, it is inevitable that the recycling of oil earnings will continue to play a dominant role in the activities of the banking system. 559. If the banking system is to play a bigger role in promoting the nonoil and real sectors of the economy, it must improve its efforts to support activities in agriculture and in the rural and SME sectors in order to promote structural change, diversify the economy and alleviate poverty. In short, banks need to develop suitable products that target short-term and long-term development in agriculture, industry, trade, energy and other services. They need to reduce interest rates and the gaps in interest rates. They need to make financial resources and services more accessible and affordable in terms of fees, charges, levies and commissions. They should ensure that credit is affordable, ensure that borrowers do not feel penalised, and encourage savings. 169