AfDB approves $100 million to support youth and women-led MSMEs in Nigeria
Abidjan, Cote d'Ivoire (PANA) - The African Development Bank (AfDB) has approved a $100 million loan to increase access to finance for youth and women-led small and medium enterprises under the Nigeria Youth Entrepreneurship Investment Bank (YEIB) initiative.
The Nigeria YEIB is a pioneering institution designed to foster economic growth and job creation in the country by acting as an ecosystem anchor and convener, bringing together relevant financial and non-financial stakeholders to collaborate more effectively in support of youth entrepreneurs, a press release by the bank said.
The Bank is leading the coordination among key Nigeria YEIB anchor investors and partners, including the Federal Government of Nigeria through the Ministry of Finance Incorporated, the Nigeria Sovereign Investment Authority (NSIA), and the Development Bank of Nigeria (DBN).
The AfDB Group’s $100 million investment will be bolstered by an additional $25 million from DBN and $5 million from NSIA.
The project has two main pillars: establishing the YEIB Investment Management Company to oversee three special purpose vehicles – an Equity Investment Fund (EIF), an Ecosystem Development Fund (EDF), and a Credit Guarantee Facility (CGF) – and creating these vehicles to support youth and women-led businesses.
The EIF will invest in early-stage and high-growth enterprises, while the EDF will provide grants for business development service providers and reimbursable grants to youth-led businesses.
The CGF will offer risk mitigation to improve access to credit for SMEs, managed by the Development Bank of Nigeria’s subsidiary, Impact Credit Guarantee Limited.
The press release said by de-risking young entrepreneurs and fostering talent, the Bank’s YEIB initiative aims to provide the patient capital and ecosystem support needed to turn ideas into sustainable businesses, offering a long-term solution to Africa’s youth unemployment crisis.
The Nigeria YEIB project aims to create over 161,000 direct jobs, 40% of which will be for women, and 1.4 million indirect jobs, with 35% allocated to women. It will also support more than 38,000 youth-led enterprises through financial services, and an additional 38,000 through non-financial services, with at least 40 per cent of beneficiaries being women.
Following the approval, AfDB's Director General for Nigeria, Dr. Abdul Kamara, emphasized the transformative nature of the project. “This initiative will be a game-changer for Nigeria’s economy, addressing youth unemployment and closing gender gaps through targeted entrepreneurship support,” Kamara said.
The Director of AfDB's Financial Sector Development Department, Mr. Ahmed Attout said: “The YEIB is a transformative initiative that moves beyond project-based approaches to systemic, institutional solutions for entrepreneurship development across all sectors. By positioning Nigerian youth entrepreneurs as a high-potential investment asset class, it brings together key stakeholders to unlock financial opportunities, open new avenues for public and private sector investors, and tackle the structural challenges facing young entrepreneurs."
The Nigeria YEIB project is the third to be approved, with efforts ongoing to establish YEIBs in several African countries.
In July 2023, the Bank approved $16 million for the establishment of a YEIB in Liberia, and in May 2024, approved $43 million for a project in Ethiopia that includes the design and establishment of the country’s YEIB.
-0- PANA MA/RA 20Oct2024
