SMEDAN to Launch Microfinance Bank, Seeks CBN License, Targets One Million SMEs
- There is a new ray of hope for robust funding for small businesses across Nigeria
- This is because the Small and Medium Enterprises Development Agency of Nigeria has applied for a CBN licence to launch a microfinance bank
- The proposed bank is expected to allow the agency to directly disburse, track and monitor funds meant for micro, small and medium enterprises
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Pascal Oparada is a journalist with Legit.ng, covering technology, energy, stocks, investment, and the economy for over a decade.
The Small and Medium Enterprises Development Agency of Nigeria (SMEDAN) has moved to establish a microfinance bank, as it seeks approval from the Central Bank of Nigeria to deepen access to finance for small businesses.
The proposed bank is expected to allow the agency to directly disburse, track and monitor funds meant for micro, small and medium enterprises, while also attracting more international development finance into the sector.
Source: UGC
The move signals a major shift in how government-backed SME funding is managed, with SMEDAN aiming to cut bureaucratic delays and ensure loans reach intended beneficiaries faster and at a lower cost.
One million new SMEs on the table
Beyond the banking plan, SMEDAN is pushing an ambitious expansion of Nigeria’s MSME base.
The agency is currently lobbying the Presidency to support the formalisation of an additional one million small businesses, on top of its plan to register at least 250,000 new enterprises in 2026.
Director-General of SMEDAN, Charles Odii, disclosed this during a media parley in Abuja, where he outlined the agency’s five-point agenda for 2026.
According to him, the goal is to significantly expand Nigeria’s formal business ecosystem and bring more informal operators into the tax and financial system.
He noted that much of the groundwork has already been laid over the past two years, with 2026 positioned as the year when those efforts begin to deliver visible results.
New MSME policy to be unveiled in 2026
According to a Vanguard report, a key pillar of SMEDAN’s plan is the review and launch of a new National MSME Policy. The current policy, last revised in 2021, expires at the end of this year.
Odii said the new framework would be developed through broad consultations across the 36 states and the Federal Capital Territory to ensure it reflects the realities faced by small business owners nationwide.
The revised policy is expected to be completed and unveiled in the first quarter of 2026.
Cheap funding takes centre stage
Access to affordable credit remains a major challenge for Nigerian SMEs, and SMEDAN says this will be a top priority in 2026. Odii revealed that the agency has negotiated funding of about N12 billion at single-digit interest rates, ranging from 9 to 9.5%.
About 500,000 MSMEs have already benefited from such loans, but SMEDAN plans to scale this up significantly, targeting between three million and five million businesses to better reflect the size of the sector.
Capacity building and infrastructure drive
Capacity development forms the fourth pillar of the 2026 agenda. SMEDAN plans to expand training programmes under its Integrated Capital Support Scheme to help MSMEs become more bankable and better positioned to access existing funds.
The final focus area is infrastructure. The agency is working with state governments and development partners to replicate industrial hubs across the country, improve access to power and lower the cost of doing business. Odii linked this directly to job creation, economic stability and national security.
Source: Getty Images
Taken together, SMEDAN’s plans point to a more structured and finance-driven approach to SME development, with 2026 shaping up as a defining year for Nigeria’s small business economy.
SMEDAN partners with CAC for free business registration
A prior report by Legit.ng disclosed that the Corporate Affairs Commission (CAC) and the Small and Medium Enterprises Development Agency of Nigeria (SMEDAN) have launched a nationwide initiative to provide free business registration for 250,000 nano, micro and small enterprises (NMSMEs).
The move the government believes will help reduce barriers to formalisation.
The scheme was announced on Friday, September 26, in Abuja at the signing of a Memorandum of Understanding (MoU) between CAC Registrar-General Hussaini Ishaq Magaji and SMEDAN Director-General Charles Odii.
SMEDAN registration form online: Eligibility and how to register
Legit.ng earlier reported that SMEDAN offers an online registration form that enables entrepreneurs and business owners to access support, funding opportunities, and government recognition.
To get started, it is essential to understand who is eligible and the steps involved in completing the online registration process.
SMEDAN is a program initiated by the Nigerian Federal Government in 2003.
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Source: Legit.ng
