Banks urged to inject N4.65trn into MSMEs to drive economic growth

The Chartered Institute of Bankers of Nigeria (CIBN) has called upon banks to utilize the N4.65 trillion raised during the recent recapitalization exercise to support Micro, Small and Medium-sized Enterprises (MSMEs) and spur economic growth. The recapitalization effort concluded on March 31, 2026, following a 24-month implementation period.

The Central Bank of Nigeria (CBN) revealed that 33 lenders met the new capital requirements, amassing a combined N4.65 trillion. CIBN President, Dele Alabi, highlighted the crucial role banks play in strengthening the economy. While the recapitalization provides banks with a buffer against economic shocks and protects their balance sheets, Alabi emphasized the need for banks to strategically deploy the additional capital.

He stressed that equity capital, being expensive, should be used efficiently to generate economic value. Alabi specifically urged banks to expand lending to MSMEs, recognizing the sector's significance as a major engine of economic activity and employment. The CIBN plans to introduce initiatives to improve MSMEs' access to finance and enhance their capacity.

This includes organizing MSME forums where businesses can directly engage with banks to finalize financing transactions. Alabi also announced plans for SME clinics to help businesses overcome challenges that impede their growth and sustainability. The forthcoming conference, themed "Building a Resilient Economy in an Era of Disruption: Strategic Imperatives for the Banking and Financial Services Industry," was deemed timely.

Alabi acknowledged the disruptive impact of technological advancements, geopolitical uncertainties, shifting customer expectations, cybersecurity threats, and climate-related challenges. These factors have underscored the importance of resilience for both financial institutions and the broader economy.