The World Bank and Nigeria’s Bank of Industry (BOI) have launched a $500 million financing initiative aimed at expanding access to credit for micro, small, and medium enterprises (MSMEs) across Nigeria, in a bid to stimulate job creation and inclusive economic growth.
The initiative, unveiled this week, is designed to bridge Nigeria’s estimated $120 billion MSME financing gap by unlocking private capital, deploying innovative credit mechanisms, and promoting digital solutions for small business financing.
According to BOI’s Chairman, the program will focus on “inclusive and sustainable investment-led growth,” supporting entrepreneurs and enterprises that are key to Nigeria’s economic diversification and employment generation goals.
Under the new plan, the World Bank and BOI will use several instruments to expand MSME access to affordable funding. These include subordinated debt, MSME investment funds, and partial credit guarantees aimed at reducing lending risks for financial institutions.
The initiative will also promote digital innovation to make credit delivery faster, more transparent, and accessible to underserved entrepreneurs, particularly women- and youth-led businesses.
Bridging Nigeria’s Credit Gap
Nigeria’s MSME sector comprising over 39 million businesses remains the backbone of the nation’s economy, accounting for more than 80% of employment and nearly half of GDP. However, access to credit has long been a major barrier to growth, with most enterprises struggling to secure loans due to stringent collateral requirements and high interest rates.
By addressing these structural challenges, the new $500 million facility is expected to stimulate private sector activity, enhance competitiveness, and create thousands of new jobs across key sectors.
Commitment to Sustainable Growth
In his remarks during the launch, BOI’s Chairman emphasized that the partnership aligns with Nigeria’s broader development agenda, focusing on technology adoption, youth empowerment, and sustainable enterprise development.
“The Bank of Industry is committed to unlocking opportunities for MSMEs to thrive,” he said. “This partnership with the World Bank will catalyse innovation, empower local businesses, and drive inclusive economic growth.”
