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VENTURES AFRICA – International Finance Corporation (IFC), the private-sector lending arm of the World Bank, has expressed willingness to capitalise Nigerian banks to mobilise microfinance banks (MFB) and boost financial service to underserved SMEs in the country.
Non-performing loans and high interest loans provided by Nigerian financial institutions have created credit scarcity in the economy which is strongly impeding the growth of small businesses, the largest employer of labour in oil-rich country.
The development unit is “going to finance market leaders and those who can set the right standard and have other microfinance institutions understand what it means to operate well,” IFC Nigeria Africa department Country Manager, Solomon Adegbie-Quaynor said.
The IFC hopes through its plan to lead an exemplary credit system with innovative products and catalyse SME lending.
According to a BusinessDay report, the IFC, focused on MFB innovations, issued a naira bond February last year to raise funds locally and to lend to clients, and has invested up to $25 million up five microfinance institutions.”
IFC also has interests in 26 MFBs in 12 countries across sub-Saharan Africa, reaching over 3 million micro-enterprises and low-income households.