5 Federal Government Funding Schemes For Nigeria SMEs

Table of contents [hide]

• 1. FGN/BOI Intervention Funds
  2. Presidential Conditional Grant Scheme
  3. Development Bank of Nigeria (DBN) Loans
  4. Micro, Small and Medium Enterprises (MSME) Development Fund
  5. Small and Medium Enterprises Development Agency of Nigeria (SMEDAN) Grants

The Federal Government of Nigeria has introduced several programs to empower its citizens by providing easily accessible funds for small and medium business owners. Eligible individuals are advised to carefully read the scheme details, provide essential documents, and begin the online application process. 

Here is a list of federal government funding schemes available for Nigerians:

1. FGN/BOI Intervention Funds

The Bank of Industry (BOI), in partnership with the Federal Government of Nigeria (FGN), has launched a transformative ₦75 billion intervention fund. Aimed at Micro, Small, and Medium Enterprises (MSMEs) across Nigeria. 

Eligibility Criteria

To qualify for the BOI/FGN 75 Billion Fund, applicants must:

• Be a Registered Business
• Operate in Targeted Sectors: The fund is designated for manufacturing and agro-processing businesses that focus on adding value to local raw materials.
• Maximum Loan Amount: Eligible businesses can access up to ₦20 million, depending on their needs and BOI’s assessment.

Document Required

• A copy of your company’s Certificate of Incorporation (CAC Certificate)
• Business plan detailing your project, goals, and how the funds will be utilized
• Financial statements and records
• Tax identification numbers and records

How to Apply for FGN/BOI Intervention Funds

To apply for Bank of Industry (BOI) intervention funds, 

• Go to the BOI online application portal, https://fgnboimsmeinterventionloan.boi.ng/signup
• Fill out the required details including business information. 
• Submit a comprehensive business plan. 
• Attach necessary documents like your Certificate of Incorporation, financial statements, and tax clearance certificate, and then 
• Wait for review and potential approval from BOI.

2. Presidential Conditional Grant Scheme

The Presidential Conditional Grant Scheme (PCGS) is a grant program that aims to support small businesses in Nigeria. The program is part of the Presidential Palliative Programme. 

Target beneficiaries 

• 70% of beneficiaries are women and youth
• 10% of beneficiaries are people with disabilities
• 5% of beneficiaries are senior citizens
• The remaining 15% are distributed to other demographics

Grant amount 

• Each beneficiary receives a grant of N50,000
• The grants are paid directly to the beneficiaries accounts

Eligible businesses 

• Small business owners in various sectors such as trading, food services, ICT, transportation, creatives, and artisans

How to apply

• To apply, eligible businesses must provide proof of their residential or business address, and personal and bank account information.
• The program is run by the Federal Ministry of Industry, Trade and Investment and Small and Medium Enterprises Development Agency of Nigeria (SMEDAN).

Note: The program was announced in December 2023 and the federal government began disbursing funds in April 2024.

3. Development Bank of Nigeria (DBN) Loans

The DBN was established by the Federal Government of Nigeria (FGN), in partnership with global development partners including the African Development Bank (AfDB), the European Investment Bank (EIB), the French Agency for Development (AFD), the KfW Development Bank and the World Bank (WB).

The Development Bank of Nigeria (DBN) targets small and medium-sized enterprises (SMEs) and micro, small, and medium enterprises (MSMEs) as beneficiaries of its loans. The DBN’s goal is to help these businesses access financing. 

Who qualifies for a DBN loan? 

• Any MSME that is involved in a productive enterprise is eligible for a DBN loan
• The MSME must be a customer of an eligible financial institution

How do beneficiaries access DBN loans? 

• DBN provides funding and risk-sharing guarantees to Participating Financial Institutions (PFIs)
• PFIs then on-lend to the end beneficiaries
• PFIs include commercial banks, microfinance banks, development finance institutions (DFIs), and other financial institutions

Document Needed for DBN Loans

• Official Government Identification
• Evidence of Company Incorporation (CAC Certificate)
• Debenture on assets of the company
• Bank Guarantee

How to apply for a Development Bank of Nigeria loan

To apply for a DBN loan, you will need to;

• Visit your bank, including a Commercial Bank, Microfinance Bank, Development Finance Institution (DFI), or other Financial Institution, and indicate that you want to apply for a DBN Loan.
• The Bank appraises the business and loan purpose, and if its assessment is favourable, the Bank applies to DBN for funding.
• If DBN approves the loan, DBN will disburse to the Bank for on-lending to end borrowers.

4. Micro, Small and Medium Enterprises (MSME) Development Fund

The MSME Development Fund, also known as the Micro, Small and Medium Enterprises Development Fund, is a dedicated fund established by the Central Bank of Nigeria (CBN) to provide financial access to Micro, Small, and Medium Enterprises (MSMEs) by channeling low-interest loans to participating financial institutions (PFIs) like Microfinance Banks, enabling them to lend to MSMEs at more affordable rates, thereby boosting economic activities and job creation within the MSME sector

Eligible PFIs:

• Microfinance Banks, NGOs-MFIs, Financial Cooperatives, Finance Companies, Development Finance Institutions, and Deposit Money Banks

Focus Areas:

• Agriculture, agro-processing, manufacturing, services, and other sectors depending on regional needs.

How to Apply

• The borrowers shall apply to the nominated PFIs for a facility, https://www.cbn.gov.ng/DFD/msmes/msmedf.html
• The PFIs shall appraise the applications for economic and financial viability before sending eligible applications to the CBN.
• The CBN shall approve and disburse funds directly to the PFIs’ correspondent bank accounts on behalf of successful applicants.

5. Small and Medium Enterprises Development Agency of Nigeria (SMEDAN) Grants

The CGS program is specifically designed for micro and nano businesses operating in local government areas (LGAs), by offering financial assistance, the scheme helps these businesses access essential equipment and grow their workforce.

Eligibility Requirements

The CGS program is specifically designed for micro and nano businesses operating in local government areas (LGAs).

Benefits

• Conditional Grant Scheme (CGS): A ₦50,000 grant for micro-enterprises to buy equipment and create jobs
• Loans: Access to loans, grants, and international funding
• Training and mentoring: Get training and mentoring opportunities
• Networking: Get networking opportunities
• Market access: Get access to export markets
• Capacity building: Get support for capacity building
• Resources: Get resources tailored to your business needs

How to Apply

• Register your interest: Visit the official SMEDAN portal to access the application forms or visit designated government offices.
• Submit your documentation: Provide the necessary documents, including project proposals aligned with CGS guidelines.
• Get approved: Once reviewed, approved businesses will receive the ₦50,000 grant to enhance their operations.