IFC has announced a partnership with Union Bank of Nigeria Plc to assist the bank in expanding lending to hundreds of companies operating in crucial sectors such as food, healthcare, manufacturing, and services. This partnership aims to improve access to finance for smaller businesses in Nigeria and to support increased trade.
With a $30 million loan from IFC, Union Bank will be able to lend more money to Nigerian companies for working capital and trade financing, particularly those whose cash flow has been constrained recently due to market disruptions on both the local and international levels.
“As a bank, we are devoted to supporting SMEs’ success. We are aware of the crucial role small companies play in reviving the Nigerian economy. We will be able to provide our consumers with financial assistance at this challenging period thanks to this money from IFC. I have faith that the funding would assist these companies take advantage of possibilities and maintain jobs “Managing Director and Chief Executive Officer of Union Bank Mudassir Amray remarked.
“Working capital financing strengthens supply chains and trade flows, paving the way for Nigeria’s economy to diversify and grow more quickly. A larger strategy to guarantee the flow of products and services is maintained despite global trade interruptions includes IFC’s relationship with Union Bank “IFC Senior Country Manager for Nigeria, Liberia, and Sierra Leone Kalim M. Shah remarked.
The credit facility for Union Bank is being provided by IFC’s COVID-19 Emergency Response Working Capital Solutions Envelope, which was introduced in 2020 to assist current IFC customers in developing countries who will subsequently extend fresh loans to businesses impacted by COVID-19’s economic effects.
Many firms in Nigeria, especially SMEs, are grappling with supply chain constraints, increased operating costs, and constrained trade growth as a result of recent disruptions to the global economy caused by COVID-19, including those caused by rising inflation and restricted access to financing.
The collaboration with Union Bank demonstrates IFC’s dedication to assisting Nigerian small businesses in maintaining and generating jobs as well as gaining access to essential resources.
The blended finance facility of the Private Sector Window of the International Development Association, which lessens the financial risks connected with investments in industries including SMEs and agribusiness, supports the loan announced today.
The second largest in Africa, after South Africa, is Nigeria, where IFC has an active $2.3 billion investment portfolio spread across a variety of industries, including agribusiness, healthcare, manufacturing, infrastructure, technology, and financial services.