The Financial Reporting Council of Nigeria (FRC) and the New Era for Sustainable Leadership and Accountability Initiative (NESLAI) have raised concern over weak financial management practices among small and medium enterprises (SMEs).

The organisations warned that the trend continues to limit access to funding and slow business expansion in Nigeria.

They gave the warning during the SME Financial Awareness Campaign themed “Benefits for Trades and the National Economy,” held in Kano, where stakeholders gathered to strengthen financial literacy and accountability among entrepreneurs.

Speaking at the event, the Executive Secretary of the Financial Reporting Council of Nigeria, Rabiu Olowo said SMEs remain the backbone of Nigeria’s economy, contributing significantly to job creation, innovation and wealth generation.

Represented by Musa Kabiru, he, noted that many businesses continue to struggle due to poor financial awareness and weak reporting structures, which hinder growth and reduce competitiveness in an increasingly formalised economic environment.

According to Olowo, financial literacy goes beyond basic bookkeeping, stressing that it involves understanding business performance, making informed decisions, and positioning enterprises for investment and credit opportunities.

He explained that the FRC, through frameworks aligned with international standards such as the International Financial Reporting Standards (IFRS), is working to promote transparency, accountability and credibility in financial reporting across sectors.

“Financial discipline is not a burden—it is a strategic advantage,” he said, urging SMEs to embrace proper record-keeping as a pathway to sustainability and growth.

Also speaking, the Executive Director of NESLAI, Edwin Olorunfemi, said the major challenge facing SMEs and cooperative societies is not just lack of capital but poor financial documentation.

He noted that many viable businesses remain excluded from funding opportunities because they cannot present credible financial records to banks, investors and government intervention programmes.

Olorunfemi said the campaign aims to bridge this gap by equipping entrepreneurs with practical skills to maintain proper records, enhance transparency and position themselves for financing.

“Our goal is simple: to strengthen the foundation of small businesses in Kano State so they can grow sustainably, create jobs, and contribute meaningfully to the economy. When SMEs get it right, the economy gets stronger,” he said.