…World Bank-backed funding focuses on small businesses
A $500 million financing programme approved for Nigeria is set to support micro, small and medium-sized enterprises, as access to affordable credit remains a major challenge for business owners. The funding, to be channelled through development finance institutions, is aimed at expanding long-term financing options for SMEs across key sectors of the economy.
Read also: World Bank approve $500m loan to Nigeria, to boost small business financing
Bridging Nigeria’s SME financing gap
Small businesses continue to face difficulties securing loans from commercial banks due to high interest rates, collateral requirements and perceived credit risks. The new $500 million facility is expected to improve lending conditions by providing guarantees and longer-tenor funding, particularly for manufacturing, agribusiness, trade and service-based enterprises.
Read also: Niger Delta MSME empowers entrepreneurs with ₦3 million grant
Focus on inclusive SME growth
The programme emphasises women-led businesses, youth-owned enterprises and firms operating in underserved regions. By reducing lending risks for financial institutions, the initiative seeks to increase the flow of credit to SMEs that have traditionally been excluded from formal financing channels.
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Rising operating costs pressure businesses
Despite the funding support, Nigerian SMEs continue to struggle with high energy costs, logistics challenges and inflationary pressures. Many business owners say operating expenses have reduced profit margins, making access to affordable finance critical for survival and expansion.
Analysts note that while the $500 million funding is a positive step, sustained SME growth will depend on effective implementation, transparent disbursement and supportive fiscal policies. Without broader reforms to ease business costs and improve the operating environment, access to finance alone may not fully address SME challenges.
