By Musa Ibrahim
The World Bank has approved a $500 million financing package to support Nigeria’s micro, small, and medium enterprises (MSMEs) under the Fostering Inclusive Finance for MSMEs in Nigeria (FINCLUDE) project.
The facility comprises a $400 million International Bank for Reconstruction and Development (IBRD) loan and a $100 million International Development Association (IDA) credit, to be implemented by the Development Bank of Nigeria (DBN), with credit guarantees provided through DBN’s subsidiary, Impact Credit Guarantee Limited (ICGL).
Designed to tackle the persistent challenges faced by MSMEs, FINCLUDE aims to expand access to affordable, longer-term finance for enterprises that form the backbone of Nigeria’s economy. MSMEs account for the majority of businesses, nearly half of the nation’s gross domestic product, and a substantial share of employment, yet access to formal credit remains limited. Fewer than one in 20 MSMEs secure bank loans, with many constrained by high interest rates, short-term tenors, and strict collateral requirements.
Women-led businesses, which constitute a significant portion of MSMEs, are particularly disadvantaged, facing higher rejection rates and a lack of tailored financial products. Agribusinesses, vital for food security and rural livelihoods, similarly struggle to secure financing for equipment, processing, storage, and logistics. FINCLUDE targets these gaps by offering longer-term, inclusive financing solutions designed to unlock growth potential in the sectors with the most impact.
World Bank Country Director for Nigeria, Mathew Verghis, described the project as a catalyst for jobs and economic inclusion. “By expanding access to finance for viable MSMEs – especially women-led firms and agribusinesses – Nigeria can accelerate growth and deliver tangible benefits to communities nationwide,” he said. “The project will make it easier for deserving small businesses to obtain the finance they need to grow, hire workers, and expand operations.”
Through DBN, the initiative will strengthen the capacity of banks, microfinance institutions, and non-bank financial service providers, including FinTechs, to provide larger loans with extended repayment periods. ICGL will scale partial credit guarantees, enabling lenders to extend credit to firms previously considered too risky. Complementary technical assistance will modernise loan appraisal processes using AI-driven digital platforms, improving data quality, accelerating decision-making, and building institutional capacity for both MSMEs and financial institutions.
Task Team Leader for FINCLUDE, Hadija Kamayo, highlighted the scale and inclusivity of the project. “FINCLUDE will mobilise around $1.89 billion in private capital, expand debt financing to 250,000 MSMEs – including at least 150,000 women-led enterprises and 100,000 agribusinesses – and issue up to $800 million in guarantees to catalyse lending,” she said. “By extending the average maturity of MSME loans to about three years, firms can invest in equipment, factories, staff, and productivity, converting finance into jobs and tangible growth.”
The FINCLUDE project is expected to enhance the quality and reach of Nigeria’s financial system by encouraging innovative products, supporting private-sector lenders, and ensuring that previously underserved groups, particularly women and rural entrepreneurs, gain equitable access to finance. By combining concessional funding, private capital mobilization, and technical assistance, the program aims to strengthen the foundation for sustained economic growth and inclusive development.
FG, World Bank Launch $500M HOPE-GOV Program To Strengthen Education, Healthcare
The Federal Government, in partnership with the World Bank, has launched the Human Capital Opportunities for Prosperity and Equity–Governance (HOPE-GOV) Program, a $500 million credit facility aimed at improving financial management and human resource capacity in Nigeria’s basic education and primary healthcare sectors.
Dr. Assad Hassan, National Coordinator of HOPE-GOV, announced the initiative in Abuja, alongside Dr. Deborah Odoh, Permanent Secretary of the Federal Ministry of Budget and Economic Planning, where the program is domiciled. The World Bank-supported facility is structured into two components: Program-for-Results and Investment Project Financing.
Of the total funding, $480 million is earmarked to reward states that achieve Disbursement Linked Results (DLRs) in education and primary healthcare, while $20 million will cover program coordination, results verification, monitoring and evaluation, and technical support for implementing agencies.
The program focuses on increasing sectoral financing, enhancing transparency and accountability in budgeting and audits, and addressing workforce gaps by improving recruitment and retention of teachers and primary healthcare personnel. Participating states will be evaluated against six independently verified DLR indicators, ensuring funds are released based on performance and measurable outcomes.
Dr. Hassan noted that the World Bank approved HOPE-GOV in September 2024, with subsequent Federal Executive Council approval in February 2025 and the signing of the financing agreement in April 2025, officially making the program effective in September 2025. All 36 states and the Federal Capital Territory have expressed interest and received subsidiary agreements for formal participation.
In her remarks, Dr. Odoh reaffirmed the Ministry’s support for the initiative and commended the HOPE-GOV team for the progress made within a short implementation period, emphasizing the program’s potential to strengthen Nigeria’s human capital through improved service delivery in education and healthcare.
