Experts are urging Nigerian small businesses to adopt alternative financing models as traditional bank loans remain largely inaccessible for most SMEs.
Speaking at the 2025 BusinessDay SME Conference and Awards in Lagos, themed “Driving Nigeria’s Economy, Empowering SMEs for Global Competitiveness,” industry leaders said the future of SME funding lies in diversified non-bank channels such as crowdfunding, credit guarantees, leasing, factoring, venture capital and government-backed intervention funds.
Femi Egbesola, National President of the Association of Small Business Owners of Nigeria (ASBON), noted that new platforms now offer easier and more flexible financing than commercial banks. He highlighted SEC-approved crowdfunding portals, the NSE Growth Board, the National Credit Guarantee Company which guarantees up to 70% of SME loans and factoring services that help businesses avoid cash-flow delays of 30–90 days.
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He added that leasing companies now allow SMEs acquire machinery through long-term payment plans, while targeted federal programmes such as RAPIJO, Women GLOBE Loan, the Youth Entrepreneurship Fund and the new Agri-Fund offer single-digit interest loans rarely available in the banking sector.
Beyond funding, Egbesola said government initiatives supporting export readiness like AfCFTA assistance, the National Single Window platform and free Business Integrity Certification are preparing SMEs for global markets. He also urged entrepreneurs to prioritise trademark protection, technology adoption and proper business structuring.
During the panel session, experts reinforced that commercial bank loans remain out of reach due to steep collateral requirements. Comfort Osemwegie, Chief Deal Maker at Dealroom Nigeria, said SMEs need patient capital such as angel investment, venture debt and equity support. She noted that venture debt offers a flexible financing bridge for startups not yet prepared to dilute ownership.
Emmanuel Olujobi, founder of Jasper School of Data (UK), stressed that Nigeria’s weak data infrastructure limits lenders’ ability to assess risk, unlike in developed markets. Paul Olaloye, Head of Audit and Compliance at IBILE Microfinance Bank, added that poor financial record-keeping by SMEs further worsens their chances of securing formal loans.
Olaloye called for stronger credit guarantee schemes and greater awareness of existing financing tools. Representing the publisher, Frank Aigbogun, BD Sunday editor Zebulon Agomuo emphasised that empowering SMEs is critical to building a globally competitive Nigerian economy.
