Relaunching small and medium-sized enterprises in West Africa

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Access to financial services remains one of the most acute constraints for small and medium-sized enterprises (SMEs) in West Africa. Due to their small size, limited experience, and undocumented performance, SMEs can be very risky for lenders, especially when operating in fragile markets or more challenging environments.

The International Finance Corporation (IFC) Small Loan Guarantee Program is an innovative mechanism to stimulate lending to SMEs. The program provides SMEs with access to financial services as well as risk-sharing support to encourage financial institutions in host countries to expand their loan portfolios, with a particular focus on smaller SMEs that are more difficult to locate. achieve. IDA’s private sector window provides program support in the form of a joint first loss guarantee of up to $ 120 million, enabling IFC to expand support in underserved markets and fragile to unbanked SMEs, in particular SMEs or SMEs owned by women. working in priority sectors such as climate or agriculture.

With program support, Union Bank in Nigeria is helping Nigerian businesses grow and create jobs. Although small businesses provide over 80 percent of jobs in Nigeria, a recent World Bank survey found that only 15 percent of SMEs in the country reported having a bank loan or line of credit. It also found that more than half of the female-run businesses surveyed cite access to finance as a major obstacle to growth.

The program will enable Union Bank to offer more products and services to women-owned businesses, especially in the conflict-affected northern and delta regions of Nigeria where entrepreneurs face challenges. particularly difficult to access financing and where more than half of the population is excluded from the financial system.


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