To support the growth of Nigeria’s medium and small-scale enterprises, MSME, the World Bank has approved a $500 million loan for the country. According to the World Bank, only 9.5 per cent of Nigerian SMEs has a loan in the books or line of credit in 2011, with SME lending constituting only a total of five per cent of commercial bank lending.

Marie Francoise Marie-Nelly, Nigeria’s country director at the World Bank, said Nigerian female entrepreneurs particularly face different challenges like knowledge gaps, limited access to markets, and regards to land ownership rights in some regions. “Specific attention will be paid to cater to supporting the needs of these business women in order to address this problem,” she assured. A Development Finance Institution, DFI, will be established to provide eligible financial intermediaries access to the funds to lend to MSMEs.

Arnaud Dornel, lead financial sector specialist and task team leader of the project, said the DFI will be operationally and financially sustainable and would be subject to regulation and supervision by the Central Bank of Nigeria, CBN. “The CBN will enforce requirements similar to those applied to commercial banks, including strong prudential transparency and accountability standards,” Dornel said.

The Development Finance Project is a joint effort of the World Bank, the African Development Bank, German based KFW, the French Agency For Development, AFD and the United Kingdom’s Department for International Development. The project will be implemented over a seven-year period by Nigeria’s Federal Ministry of Finance.