The Development Bank of Nigeria (DBN), the first wholesale development finance institution in the country, has partnered with LAPO Microfinance Bank Limited to provide lending to about 10,000 MSMEs.
A statement from Mr Idris Salihu, Head, Corporate Services, said the partnership, which has commenced will see more MSMEs have access to long term financing.
Commenting on the partnership, the MD/CEO of DBN, Tony Okpanachi said, “This is a milestone achievement and I am particularly happy that we are getting a lot of traction on our lending activities with LAPO.”
“The collaboration is encouraging because they are among the first three microfinance banks we commenced our initial pilot lending with in November 2017. I must commend the management team for keying into our business model and I strongly believe we can work together to alleviate the financial constraints faced by MSMEs.”
On LAPO’s commitment to the development of Micro, Small and Medium Scale Enterprises in Nigeria, the MD/CEO, Godwin Ehigiamusoe said, “We strongly believe in the capacity and potentials of the MSMEs in alleviating poverty and creating jobs for our growing population.
“We are happy with the partnership and we will continue to work with DBN to ensure that collectively, we are able to provide the much-needed funding that the MSMEs require to flourish.”
According to the IFC MSME Finance Gap Report in 2017, there are over 37 million MSMEs contributing over 50 percent of Nigeria’s GDP. However, less than 5 percent of these businesses have access to credit in the financial system.
DBN’s entrance and its interventions are, therefore, relevant and timely. It will reverse the trend by making it easier for MSMEs to access financing to build and expand their businesses and unleash the power of the MSME business segment to drive national economic development.
The DBN was conceived by the Federal Government in collaboration with the World Bank, African Development Bank, European Investment Bank (EIB), German Development Bank (KfW) and the French Agency for Development (AFD) to address financing challenges facing Micro Small and Medium Enterprises (MSMEs) in Nigeria.