The Digest:
The Central Bank of Nigeria (CBN) is considering the recapitalisation and restructuring of development finance institutions (DFIs) to bridge the funding gap for micro, small, and medium-sized enterprises (MSMEs). Deputy Governor Muhammad Abdullahi said the total asset base of all DFIs is slightly above N8 trillion, while MSMEs require over N130 trillion. He noted that simply injecting capital is not enough; DFIs must become "bankable and investable." The CBN is reviewing DFI structures to improve efficiency and risk appetite.
Key Points:
- MSMEs face a funding gap of over N122 trillion.
- The CBN wants to avoid administratively directed credit to banks.
- Banks recently raised N4.6 trillion from recapitalisation.
- DFIs include BOI, BOA, DBN, NEXIM, and others.
- Reforms aim to incorporate more market-based principles.
