Proparco, a subsidiary of the AFD group dedicated to the private sector, has granted last week a portfolio guarantee of 9 billion nairas (approximately $6 million) to Wema Bank in order to strengthen access to credit for micro, small and medium-sized enterprises (MSMEs) in Nigeria.

Deployed via the ARIZ mechanism, this guarantee covers 50% the risk of final loss on the loans concerned. It will allow Wema Bank to build up, over a period of two years, a financing portfolio up to 18 billion naira in favor of SMEs, still a segment largely underfinanced by the traditional banking system.

The credits will target sectors considered strategic for the Nigerian economy, including agriculture, health, education, the pharmaceutical industry and green finance. Short-term facilities will also be offered to meet working capital needs.

According to Xavier Echasseriau, regional director of Proparco for Nigeria, this first partnership with Wema Bank aims to stimulate sustainably entrepreneurship and employment in a country marked by a strong population growth and a structural deficit in financing SMEs.

According to the European Investment Bank, Citing the Development Bank of Nigeria, only 5% of the 37 million micro and small businesses, which contribute to almost 50% of GDP, have today access to bank credit.