International Finance Corporation offers Credit Line to Nigerian Women EntrepreneursOne of the 25 Nigerian mega banks- Access Bank (http://www.accessbankplc.com/index.cfm?ID=3000) in collaboration with the World Bank's International Finance Corporation (IFC)- will start extending lines of credit to Nigerian women entrepreneur. The bank signed a $15 million loan with the IFC last week.
Access Bank Plc will be one of the first banks in Africa to dedicate lines of credit to finance women-owned businesses and this is the first major loan under IFC's Gender Entrepreneurship Markets (GEM) program, which is designed to leverage the potential of women in emerging markets, according to IFC press release.
This collaboration is being driven by the World Banks research that shows African women are more entrepreneurial and more likely than men to augment household income through small to mid sized businesses. While this may be a hard knock on the head for African men- it is the truth.
The last time I checked, the Nigerian the Small and Medium Enterprises Equity Investment Scheme (SMEEIS)- a public-private organ meant to provide funds to small and mid sized businesses in the country- had only disbursed 30% of its funds since its inception in 1999.
The problem with small business may not necessarily be that of capital, but access. Applicants to the SMEEIS have often complained of difficulties in navigating the bureaucratic bottlenecks and meeting the eligibility requirements- conditions that have been put in place in order to minimize default rate. These in combination with poor accounting skills and inadequate and improper documentation have rendered the fund inaccessible to many.
How the IFC/Access Bank-2-billion-Naira fund will address and ease access to credit is not clearly discernable (to me) at this time. Clearly, Nigerian small businesses will benefit from re-education and the acquisition of basic and relevant business skills, and I won't be surprised if these are eligibility criteria to access the IFC fund. Building a strong collaborating with non-profit/non-governmental organizations is one of the few evidence-based interventions that may help bridge this void.
Tags: Africa Nigeria Investment Governance