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World Bank approves $500m FINCLUDE funding to boost MSME access to credit in Nigeria
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Programme targets women-led businesses and agribusinesses to drive jobs and inclusive growth
- Project expected to unlock $1.89bn private capital and support 250,000 MSMEs
The World Bank has approved a $500 million financing package to improve access to credit for micro, small and medium enterprises (MSMEs) in Nigeria, as part of efforts to stimulate job creation, productivity and inclusive economic growth.
The funding, announced on Saturday, is provided under the Fostering Inclusive Finance for MSMEs in Nigeria (FINCLUDE) project. It comprises a $400 million loan from the International Bank for Reconstruction and Development (IBRD) and a $100 million credit from the International Development Association (IDA).
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Implementation of the project will be led by the Development Bank of Nigeria (DBN), with Impact Credit Guarantee Limited, its subsidiary, responsible for issuing credit guarantees to de-risk lending to small businesses.
The World Bank noted that MSMEs dominate Nigeria’s business landscape, contribute nearly half of the country’s gross domestic product, and account for a large share of employment. Despite this, access to formal finance remains limited, with fewer than five per cent of MSMEs able to obtain bank credit.
Where loans are available, the lender said they are often short-term, costly and tied to collateral requirements beyond the reach of most small businesses. Women-led enterprises, which represent a significant portion of the MSME sector, face even greater barriers, including higher rejection rates and lack of suitable financial products.
Agribusinesses, vital to food security and rural livelihoods, also struggle to access long-term funding needed for equipment, processing, storage and logistics.
According to the World Bank, the FINCLUDE project is designed to close these financing gaps by expanding access to affordable, longer-tenor loans and developing tailored solutions for women-owned businesses and high-impact agribusinesses.
Commenting on the approval, Mathew Verghis, World Bank Country Director for Nigeria, said the initiative is focused on jobs, opportunity and inclusion, adding that improved access to finance would help small firms expand, hire more workers and contribute meaningfully to economic growth.
Under the programme, DBN will strengthen the capacity of commercial banks, microfinance banks, fintechs and other non-bank financial institutions to provide larger loans with more flexible repayment terms.
Partial credit guarantees will also be scaled up to encourage lending to businesses considered high-risk under current market conditions.
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The project will further deliver technical assistance, including the deployment of AI-powered digital tools to modernise loan appraisal, speed up credit decisions, enhance data usage and improve impact tracking for lenders and MSMEs.
The World Bank said FINCLUDE is expected to mobilise about $1.89 billion in private capital, expand debt financing to 250,000 MSMEs—including at least 150,000 women-led businesses and 100,000 agribusinesses—and support up to $800 million in credit guarantees.
The initiative is also projected to extend the average maturity of MSME loans to around three years, enabling businesses to invest in equipment, facilities, staffing and productivity, and translate financing into sustainable jobs and growth.
The approval adds to Nigeria’s growing portfolio of World Bank-backed programmes.
As of June 30, 2025, Nigeria’s external debt stood at $46.98 billion, with the World Bank Group remaining the country’s largest single creditor, accounting for over 41 per cent of the total.
