Di Small and Medium Enterprises Development Agency of Nigeria, wey dem dey call SMEDAN, don launch new N500 million zero-interest fund wey dem name Grow Fund for Small Businesses for Nigeria. Dis one na good news for small business owners wey dey struggle to get money for dia business.
SMEDAN Director-General, Charles Odii, announce di initiative for Abuja as part of activities to mark di 2026 World MSME Day. E say di revolving loan go be disbursed through cooperatives, trade unions, business member organisations and associations, not to individual entrepreneurs. According to am, di association-based model go improve accountability, loan recovery and ensure di funds reach genuine business owners.
Odii talk say dis financing na to address one of di biggest challenges wey small businesses dey face for Nigeria. “We visited traders at one of di markets today to engage directly with dem because e no enough to sit for offices and make policies without understanding dia realities. Many of di challenges dem raise border on financing, which be why we dey launch di Grow Fund for Small Businesses for Nigeria,” e yarn.
E say beneficiaries go fit access di zero-interest fund to boost working capital, procure workspaces and acquire tools wey dem need for dia business. “We no dey give di money to individuals directly. We dey give am to associations wey understand dia members and fit manage di funds responsibly,” Odii tok.
Odii say repayment terms go be agreed with each association, and di flexible arrangement go allow di revolving fund to benefit more entrepreneurs. Di SMEDAN boss say di initial N500 million go be expanded through partnerships with state governments, development partners and oda institutions wey dey willing to provide matching funds.
E also say SMEDAN dey review di draft National MSME Policy before forwarding am to President Bola Tinubu for approval. Di proposed reforms include single-digit interest loans for MSMEs, reserving 30 per cent of government procurement for small businesses and removing age limits from intervention programmes. Odii say di agency go engage relevant regulators on concerns wey dey affect small businesses, including advertising registration requirements.
Small scale businesses deserve adequate attention. Globally, di micro, small and medium scale enterprises sector na di spine of most national economies because dem dey weather and overcome many challenges to grow and keep jobs for locals. E fit say di official theme wey United Nations Industrial Development Organisation designate for di 2026 MSME Day na “Empowering MSMEs through Innovation and Sustainable Industrial Development.”
E important say all relevant authorities for di country move from rhetoric to concrete actions on how to lift di majority of our people out of poverty. Ordinarily, MSMEs account for 90 per cent of businesses, 60 to 70 per cent of employment and 50 per cent of di Gross Domestic Product worldwide, according to World Bank. For Nigeria, SMEDAN reports say MSMEs currently represent 96 per cent of businesses for di country and contribute 75 per cent of national employment.
Unfortunately, dis na sector wey don dey neglected for Nigeria. Although SMEDAN don launch N500 million zero-interest for MSMEs, many similar initiatives don end up as slush funds for political operatives. While announcing di effort as part of package for MSME Day, Odii say di association-based model go improve accountability, loan recovery and ensure di funds reach genuine business owners.
Meanwhile, experts don identify strengthening di regulatory framework and designing effective support mechanisms as some of di issues wey need to be addressed. However, we no dispute say di main challenge don always be financing since conventional banks no dey cut out for long term lending wey MSMEs need. E equally known say dese banks dey mostly comfortable to lend to short-term business ventures as against start-ups wey go need longer gestation period to pay back.
According to most estimates, fewer than five per cent of MSMEs fit access any form of funding support by way of loans or overdraft from financial institutions. Di Central Bank of Nigeria don for past establish numerous programmes to support MSMEs but with little to show for such efforts. For instance, for August 2013, CBN launch di micro, small and medium enterprises development fund with share capital of N220 billion. Di Fund aim to enhance access of MSMEs to financial services, by channelling single-digit loans at nine per cent interest rate to dem, through di Primary Finance Institutions. When di intended end users no fit access di facility, di National Collateral Registry don introduce. Yet, di problem persist.
Di Nigeria Incentive-Based Risk Sharing System for Agricultural Lending, wey dem dey call NIRSAL Plc, CBN with di idea to transform NIPOST into a microfinance bank with branches for all di 774 local government areas of di country. But dis limitless potential for inclusive and sustainable economic growth wey fit be harvested from MSMEs remains largely untapped. Yet, by sustaining di livelihoods for di very poor among us, MSMEs na di backbone of our society. And dem deserve di support of government at all levels.
