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Sustaining Small and Medium Enterprises for Nigeria’s Economic Growth

The SMS &P team – Small and Medium Scale Businesses and Partners – is fully dedicated to supporting SMEs. The team works closely with Microsoft’s network of partners. Marius Moantsoga, SMS&P Lead for Microsoft Nigeria explains the role of SMS in the economy. He spoke to emeka okafor.
The World Economy
It is hardly necessary to make the point that we are in the midst of an economic downturn that has permeated markets worldwide. The issue dominates our government’s agenda and is splashed across our media. Few of us have failed to feel its impact directly. This downturn is truly a global issue and is proof—as if it were needed—that we live in a global village, where the ripples of one uncertain market can be felt across the world.
Nigeria has not been isolated from the impact of this recession. In fact, according to the 2008 African Economic Outlook published by the Organisation for Economic Cooperation and Development (OECD), Nigeria’s growth rate is expected to fall to 4% in 2009 as a result of the Organization of the Petroleum Exporting Countries’ (OPEC) quota on oil production, as well as declining foreign investment.
In recent years there has been a strong focus on making Nigeria attractive to foreign investors and international corporations with the aim of spurring economic growth through imported expertise and capital. Inevitably there is some concern now as to how this economic climate will impact these growth factors.
However, the reality is that Nigeria’s small and medium enterprises (SMEs) account for 70% of the country’s industrial jobs and some 95% of its manufacturing activity. This is according to the African Development Bank (AfDB) and the OECD. As such, while we must be mindful of ensuring Nigeria remains an attractive prospect for foreign investment, it is vital that we remain committed to the growth and success of our own SMEs.
Sustainable Foundations
SMEs are the foundation for Nigeria’s sustained economic growth. They serve as an engine of job creation and skills development. Businesses built and nurtured in Nigeria utilise our local talent—both men and women—and encourage entrepreneurship and a culture of self-reliance. They also transcend different industries, spurring economic diversification and enabling the development of rural communities.
By creating an environment where people are encouraged to pursue their entrepreneurial ambitions, we can ensure that our talented citizens remain in Nigeria.
Challenging Times
Setting up a business and fostering its growth is a challenge in any economic climate. In today’s market conditions, just getting a business off the ground, let alone seeing it survive well into the future, is a daunting challenge.
According to the FATE Foundation, a Nigerian organisation developed to promote business and entrepreneurial development among Nigeria’s youth, rapid urbanization, coupled with a shrinking economy, has created an environment in which over 70% of the recent graduates who reside in urban areas are unemployed. While many of these graduates are eager to set up their own businesses, only a few have succeeded.
And the SMEs that are already up and running are finding it difficult to secure the credit they need to sustain their businesses in the face of reduced customer demand.
The reality is that the economic crisis requires us to take decisive steps to protect the years of economic growth we experienced. It is important to ensure that the progress made in creating an environment where such businesses could be set up and succeed is not undone.
The consensus across Africa is that SMEs will play a critical role in ensuring our survival through these times. In fact, the AfDB recently extended a US$100 million line of credit to Nigeria’s Intercontinental Bank so that Nigeria’s SMEs could access the money they need to sustain their operations.
Also, the African Commission just proposed partnering with the AfDB to establish a US$3 billion African Guarantee Fund to boost the development of SMEs in Africa. In the words of the Commission, such investment will unleash the power of African entrepreneurship by enabling young people to translate their good ideas into practical plans.
Our own government has likewise implemented a number of initiatives to support the development of SMEs. One is the Small and Medium Enterprises Development Agency of Nigeria, which works to establish business support centres and provide our SMEs with enhanced access to finance and management training
Another is the Small and Medium Industries Equity Investment Scheme fund, which requires all banks in Nigeria to set aside 10 percent of their annual after-tax profit for equity investment in small and medium sized business. Such initiatives are crucial to ensuring that funds are channelled to the businesses that need them most.
Taking Advantage of Technology
Entrepreneurs can also use the technology already at their disposal to surmount some of the challenges they face. It’s a fact that technology is effectively enabling individuals to set up and run a business from their homes.
Looking Forward
Enabling the success of our local SMEs is not just about facilitating Nigeria’s immediate economic recovery or ensuring long-term sustainable growth. It is also a vital element in seeing Nigeria compete on the global economic stage. The world’s greatest success stories all began as small enterprises, and some of the world’s most powerful nations, such as the United States, have been built on the strength of an entrepreneurial culture.
Among the many SMEs already in existence in Nigeria, or the budding entrepreneurs eager to set up new enterprises, there may well be the world’s next Bill Gates or Aliko Dangote. It is to Nigeria’s benefit, particularly in these tough times, that we continue to create an environment where such businesses are nurtured.
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NIA Questions Legality of Reps’ Financial Probe

The Nigerian Insurers Association has urged the House Committee on Capital Market and Institutions to respect the constitutional separation of powers as it carries out a probe on over 20 insurance firms.
In a statement on Tuesday night, the Director General/Chief Executive Officer of NIA, Mrs Bola Odukale, said the decision of NIA and the affected firms to approach the court was to seek clarity on the constitutional limits of the House Committee’s probe.
It would be recalled that the House of Representatives on Monday is investigating no fewer than 25 insurance companies operating in the country for various financial infractions spanning financial reporting, claims settlement, premium remittance, and issuance of policies.
The Chairman, House Sub-Committee on Capital Market and Institutions, Kwamoti Laori, during a meeting with the management of the insurance companies at the National Assembly Complex in Abuja, said the meeting was convened following the receipt of a petition on infractions by the insurance companies.
In the statement, Odukale said, “The Association wishes to state unequivocally that all actions taken by the NIA and the affected member companies in response to the Committee’s invitations and pronouncements were based entirely on legal advice by its Solicitors. It was on the firm instruction of legal counsel that recourse was made to the courts.
“The objective of approaching the Court is to seek judicial guidance on the legality, propriety, and constitutional limits of the Committee’s intervention in order to safeguard institutional integrity, uphold regulatory independence, and ensure that legislative oversight remains within the bounds of law.
“The Court action seeks to determine whether the current posture of the Committee reflects an exercise of legislative judgment, which, by constitutional design, is the exclusive province of statutory regulators, such as the National Insurance Commission, Securities and Exchange Commission, Nigerian Exchange, Financial Reporting Council, Nigeria Data Protection Commission, and the National Information Technology Development Agency.
“This raises serious questions about legislative overreach and an erosion of the doctrine of separation of powers, a cornerstone of Nigeria’s constitutional democracy.”
Odukale maintained that the NIA was committed to lawful and constructive engagement with all arms of government, provided that such engagement respects the autonomy of statutory regulators and the boundaries established by the Constitution.
“The NIA will continue to provide its full support to all member companies while upholding the principles of legal compliance and sector-wide integrity,” Odukale concluded.
17 of the companies that went to court were represented by their lawyer, Mr Abimbola Kayode, at the meeting with the committee.
News
Horn of Africa Leaders Seek Enhanced Digital Integration for Increased Regional Growth

Finance ministers and development partners from the Horn of Africa have called for enhanced digital integration to boost trade, drive economic growth and promote regional stability during the 25th Ministerial Meeting of the Horn of Africa Initiative (HoAI).
Held in Nairobi, on July 14, the meeting was co-chaired by the African Development Bank’s Vice President for Regional Development, Integration and Business Delivery, Nnenna Nwabufo and Somalia’s Minister of Finance, Bihi Iman Egeh. Discussions underscored the critical role of digital integration in reducing trade barriers, boosting government service delivery and creating employment — particularly for the region’s youth.
“Digital technologies are shaping today’s economy and tomorrow’s industries. By embedding these technologies into our programs, we can not only improve inclusion but also leapfrog outdated development models,” said Nwabufo.
She called for digital integration a “central enabler” in each of the Horn of Africa Initiative’s pillars – trade, infrastructure, resilience, and human capital,
Learning through experience
Drawing from global and regional success stories, speakers highlighted the transformative potential of technology-led development. The ministers pointed to the Philippines as a strong example, where ICT has generated millions of jobs in business process outsourcing. Similarly, Kenya’s fintech innovation—especially the success of M-PESA—was cited as a model for scaling digital financial services across the region.
Participants urged governments to proactively foster digital ecosystems by capitalizing on the demographic dividend, identifying infrastructure upgrades, tighter regulatory reforms, and digital skills trainings as priorities to enable broader participation in the digital economy.
Minister Egeh reiterated the need for more coordinated regional efforts to create the enabling environment required for accelerated digital integration and expansion. He referenced the HoAI Digital Policy Matrix, adopted in 2023 which provides a blueprint on how to address key obstacles to achieving effective digital integration across the region.
Barack Makokha, Kenya’s Cabinet Secretary for National Treasury, underscored the importance of regionally-aligned public private partnerships and advocated for blended financing to reduce investment risk and expand digital access in underserved areas.
World Bank Vice President for Eastern and Southern Africa, Ndiame Diop, called for a comprehensive multi-pronged approach, combining cross-border coordination, large-scale financing, robust policy support, and digital infrastructure investments. He pointed out that such measures could transform digital integration into, “a powerful engine of economic transformation” for the Horn of Africa—ensuring no one is left behind in the digital era.
The meeting concluded with a shared recognition that sustained political will and the determination to implement a multifaceted approach are essential to unlocking the region’s economic potential and driving long-term growth.
The event also welcomed observers from the East African Community, Agence française de développement, and Shelter Afrique, reflecting strong regional and international backing for the HoAI in the development community.
News
CSCS Inaugurates Custodian Portal to Enhance Digital Access, Operational Efficiency

Central Securities Clearing System Plc (CSCS), Nigeria’s capital market infrastructure provider, has launched its Custodian Portal, a user-centric digital solution designed to optimise custodian operations through intuitive, secure and efficient features.
Haruna Jalo-Waziri, Chief Executive Officer (CEO), CSCS, announced this in a statement on Monday.
The CSCS is a Public Limited Company with a diversified shareholder base, which serves as the Central Securities Depository for the Nigerian Capital Market.
It serves as the Central Depository for Equities, Commercial Papers, Corporate Bonds, Sub-National Bonds, certain Sovereign Bonds like the FGN Sukuk and the FGN Savings Bond, Equity-traded Funds, Real Estate Investment Trusts, Mutual funds and Commodities.
Jalo-Waziri said that the custodian portal offered a streamlined experience for market participants with powerful tools that facilitate comprehensive portfolio and trade management, document tracking, share transfer operations, client symbol search, and real-time access to vital data.
He explained that the portal, designed to operate through a flexible subscription-based model, empowered users to manage their records effortlessly and securely through convenient payment channels such as GTPay and Paystack.
According to him, “Digital transformation remains at the core of our strategy to enhance the efficiency, transparency and accessibility of Nigeria’s capital market services.
“The custodian portal is a significant leap in that direction, offering custodians a centralised platform to manage critical processes in real-time.
“We are excited about the value this innovation brings to our stakeholders, and we will continue to evolve the platform in line with users’ needs and industry trends.”
The CEO also explained that the portal was designed with user experience in mind with feature tools like portfolio viewing and downloads in PDF or Excel format.
He further said that it also featured tracking of stock movements across date ranges, inbox messaging and request tracking, as well as robust user management capabilities including role assignment and status tracking.
Similarly, the Divisional Head, Business Technology and Digital Innovation, CSCS Plc, Tobe Nnadozie, said that the portal aligned with CSCS’s drive to automate the market.
“In addition to the normal features, the platform is a part of an omnichannel platform for custodians, and includes API services.
“It also connects to the market-wide workflow, which CSCS has built to ensure secured communication and approvals across all major stakeholders in the market.
“The platform is well secured with best-of-breed cybersecurity solutions and our SOC,” he said.
The Custodian Portal reinforces CSCS’s commitment to leveraging technology to streamline back-office functions and support a more agile, data-driven capital market ecosystem.
All custodians in the Nigerian capital market have now been successfully on-boarded on the Custodian Portal, marking a significant milestone in CSCS’s ongoing drive to enhance collaboration, standardise operational processes, and promote digital adoption across the market.
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