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CPPE says MSMEs lose ₦5tn–₦10tn annually to employee fraud and occupational corruption.
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Retail, hospitality and agribusiness hit hardest by inventory theft, payroll manipulation.
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Dr Muda Yusuf urges digital payments, internal controls to curb MSME fraud.
The Centre for the Promotion of Private Enterprise (CPPE) has raised concern over what it described as massive internal financial leakages draining Nigeria’s Micro, Small and Medium Enterprises (MSMEs).
In a policy brief released on Sunday, CPPE said employee fraud and occupational corruption are costing the sector between ₦5 trillion and ₦10 trillion annually.
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Chief Executive Officer of CPPE, Muda Yusuf, stated that the losses represent between five and 10 per cent of annual revenues for many small businesses.
He noted that the impact is devastating for enterprises operating on profit margins below 15 per cent.
“These leakages are often the difference between survival and bankruptcy for many small businesses,” Yusuf said.
The report identified retail, hospitality and agribusiness as the most vulnerable sectors, citing high cash transactions and weak documentation systems.
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It added that poor segregation of duties within informal business structures allows fraud to persist undetected for years.
“Occupational fraud is not merely a governance issue; it is a national welfare concern,” Yusuf said, warning that the trillions lost annually translate into reduced investments, fewer jobs and rising business failures.
To address the challenge, CPPE called for wider adoption of digital payment systems and basic accounting software among small businesses to improve transparency and create audit trails.
The organisation also advocated the development of a national MSME internal-control framework and stronger legal mechanisms to ensure swift asset recovery,
It stressed that curbing internal corruption is critical to strengthening the sector’s contribution to Nigeria’s non-oil economy.
