The World Bank has approved a $500 million financing package aimed at expanding access to credit for micro, small, and medium enterprises (MSMEs) across Nigeria, it announced on Saturday.
The package comprises a $400 million loan from the International Bank for Reconstruction and Development (IBRD) and a $100 million credit from the International Development Association (IDA).
The initiative, titled Fostering Inclusive Finance for MSMEs in Nigeria (FINCLUDE), will be implemented by the Development Bank of Nigeria (DBN), with credit guarantees delivered through its subsidiary, Impact Credit Guarantee Limited.
“Nigeria’s MSMEs, which account for the majority of businesses in the country and contribute nearly half of the nation’s gross domestic product (GDP), continue to face significant barriers in accessing formal finance. Despite providing a large share of employment, fewer than one in 20 MSMEs have access to bank credit”, the global lender said.
It added that available loans are often short-term, expensive, and dependent on collateral requirements that exclude many viable firms. Women-led enterprises, which constitute a substantial portion of MSMEs, are disproportionately affected by higher rejection rates and limited access to tailored financial products.
Agribusinesses, critical to food security and rural livelihoods, also struggle to secure longer-tenor financing for equipment, processing, storage, and logistics.
FINCLUDE is designed to address these challenges by expanding affordable, longer-term finance and developing tailored solutions for segments with the greatest development impact, particularly women-led businesses and agribusinesses.
Commenting on the approval, World Bank Country Director for Nigeria, Mathew Verghis, emphasised the project’s focus on economic inclusion and job creation.
“FINCLUDE is about jobs, opportunity, and inclusion. By opening finance for viable MSMEs—particularly women-led firms and agribusinesses—Nigeria can accelerate growth and deliver tangible benefits in communities nationwide,” Verghis said.
He added that the project would make it easier for deserving small businesses to obtain financing needed to grow and employ workers, noting that support for lenders practising inclusive finance and the provision of fairer, longer-term loans would strengthen the businesses that drive Nigeria’s economy.
The World Bank stated that the project would help mobilise private investment and expand access to inclusive and innovative financial products for MSMEs nationwide.
Through the Development Bank of Nigeria, the operation will strengthen the capacity of banks, including microfinance banks and non-bank financial institutions such as fintech firms, to provide larger loans with more reasonable repayment periods.
