The World Bank is expected to approve a $500 million loan for Nigeria today (Friday, December 19, 2025), aimed at improving access to finance for micro, small, and medium enterprises (MSMEs) across the country. The funding forms part of the Fostering Inclusive Finance for MSMEs in Nigeria (FINCLUDE) Project, designed to unlock private capital and expand innovative lending solutions for small businesses.
According to project details, the facility is part of a broader $2.39 billion financing package, with the World Bank contributing $500 million—$400 million from the International Bank for Reconstruction and Development (IBRD) and $100 million from the International Development Association (IDA). The Federal Government will serve as the borrower, while the Development Bank of Nigeria (DBN) will act as the implementing agency overseeing fund deployment.
The remaining $1.89 billion required for the project is expected to come from commercial lenders as unguaranteed private financing. The World Bank said the project would leverage DBN and its subsidiary, Impact Credit Guarantee Limited, to deepen credit access for MSMEs through tailored financial instruments, risk-sharing mechanisms, and market-driven solutions.
Structured around three pillars, the FINCLUDE project will introduce inclusive MSME finance products, mobilise private capital through partial credit guarantees, and provide technical assistance to modernise Nigeria’s MSME finance ecosystem. This includes subordinated capital for financial institutions, the creation of an MSME investment fund, and capacity-building initiatives aimed at digitising lending processes and strengthening regulatory oversight.
The World Bank noted that Nigeria is undergoing a “critical economic transition,” citing reforms such as fuel subsidy removal and exchange-rate unification as steps that have helped stabilise the economy. While growth prospects are improving—supported by projections from the International Monetary Fund—the bank warned that access to finance remains uneven, especially for MSMEs, women-led businesses, and the agriculture sector. If approved, the FINCLUDE loan will further cement the World Bank’s role as Nigeria’s largest single external creditor and a key partner in the country’s economic reform agenda.
source: punch