Proparco, the private sector financing arm of the French Development Agency (AFD), is providing a $35 million loan to First City Monument Bank (FCMB).
The financing and guarantee will support high-impact small and medium-sized enterprises (SMEs) and climate projects.
Proparco’s $35 million loan to FCMB supports the bank’s impact financing in Nigeria. The Lagos-based financial services holding company is also getting a N5 billion (more than $12 million) guarantee from Proparco, the private sector financing arm of the AFD.
The French Government’s financial institution classifies this guarantee in the Euriz portfolio. This €181 million facility was launched with the European Union (EU), and the African, Caribbean and Pacific (ACP) Group of States with the objective of offering guarantees to local banks to facilitate lending to SMEs in the ACP zone.
FCMB will build on the recently obtained loan to strengthen its positioning on the high-impact SME segment and on climate projects.
Adrik.21 reports that Proparco believes that its financing supports FCMB’s goal of promoting women’s financial inclusion through its SheVentures program set up in 2019.
FCMB will build on the recently obtained loan to strengthen its positioning on the high-impact SME segment and on climate projects.
This initiative provides women entrepreneurs with dedicated solutions such as interest-free and concessional loans, as well as tailored training and mentoring.
“One of the most SME-friendly banks in Nigeria, FCMB, is well positioned to offer tailored financing solutions for these businesses. It is a specialized organization that has developed a robust digital offering, the Quickloan platform, for SMEs. The bank has strong growth ambitions in this segment,” explains Proparco.
FCMB will rely on the Euriz mechanism to guarantee up to 70% of its loans to high-impact SMEs. These include women- and youth-led SMEs, SMEs operating in the agriculture, education, health and digital sectors, start-ups and green SMEs.
Small businesses, including micro, small and medium enterprises (MSMEs), play a vital role in Nigeria’s economy and account for 96% of the country’s businesses, according to official data. Despite the problem of access to finance they face, SMEs create 84% of jobs and contribute to the national wealth, representing 48% of Nigeria’s gross domestic product (GDP).
