Nigeria and World Bank launch $165m initiative to support MSMEs
The objective of the project is to generate employment, particularly among the youth.Nigeria has partnered with the World Bank to launch the Growth and Employment (GEM) Equity Window, a $165 million (€151 million) grant scheme to support micro, small and medium scale enterprises (MSMEs).
The grant will be made available to qualifying venture capital and private equity firms and other equity providers to incentivise them to provide equity finance to MSMEs.
"The objective of the project is to generate employment, particularly among the youth. The World Bank is the funder of the project. Those who benefit include any small enterprise and any aspiring young person that wants to set up a business. They can register under the business innovation platform, which will be launched in December," Lead Financial and Private Sector Specialist at the World Bank, Michael Wong, told This Day.
He added that the project has windows for equity companies, which should provide capital to aspiring high growth potential firms.
The partnership comes a month after Guarantee Trust Bank (GTB) launched a N3 billion (€13.3 million) scheme to promote the development of SMEs in Nigeria, in partnership with Agence Française de Development (AFD).
The scheme provides banks, private equity investors and other financial institutions a safer platform to increase participation in SME financing by providing foreign guarantees to local credit facilities advanced to SMEs.
Denys Gauer, the French Ambassador to Nigeria, said that in spite of the widespread presence of SMEs in Nigeria, the sector faces major obstacles, including limited access to bank financing, mostly because of the risk factor associated with SMEs.