The World Bank and the Bank of Industry (BOI) have unveiled a $500 million development finance plan designed to unlock private capital, expand access to credit for micro, small and medium enterprises (MSMEs), and accelerate job creation across the country.

The initiative, announced during the second edition of the Bank of Industry Development Lecture Series in Abuja, is part of a broader effort to reshape Nigeria’s development finance model and address the country’s estimated $120 billion MSME funding gap.

Speaking at the event, Matthew Verghis, World Bank Country Director for Nigeria, and Mansur Muhtar, BOI Board Chairman, underscored the urgency of redesigning Nigeria’s development finance system to reflect global trends and domestic priorities.

Verghis noted that Nigeria stands at a critical turning point, with visible gains emerging from ongoing fiscal and monetary reforms.

He cited signs of macroeconomic stability, easing inflation, and rising foreign reserves as evidence that the government’s policies are beginning to yield tangible results.

He commended Nigeria’s recent removal from the Financial Action Task Force (FATF) grey list as a “landmark achievement,” describing it as a signal that the country’s financial system now meets international anti-money laundering standards.

“That single step enhances investor trust and strengthens the foundation for sustainable economic growth,” Verghis said.

However, the World Bank Country Director cautioned that poverty and unemployment remain persistent challenges, stressing that millions of Nigerians are yet to feel the impact of macroeconomic stabilisation.

“We are seeing progress in stabilisation, but the purchasing power of citizens remains weak because inflation is still high. To sustain these reforms, we must focus on policies that drive job creation and increase access to finance,” he added.

Verghis said the World Bank–BOI framework seeks to transform development finance in Nigeria by mobilising private capital and leveraging digital innovation to close the country’s vast infrastructure and enterprise funding gaps.

“Among the initiatives under the plan is the Fostering Inclusive Finance for MSMEs (FIRM) Project, a $500 million programme expected to attract at least four times that amount in private sector funding.

“The project is designed to bridge Nigeria’s $120 billion MSME financing gap through instruments such as subordinated debt, MSME investment funds, and partial credit guarantees.

“We are very excited about the FIRM project. It will expand MSME access to long-term capital and provide the financial infrastructure needed for growth,” Verghis said.

He added that digital innovation would play a key role in expanding access to affordable credit.

He also highlighted the role of initiatives such as InfraCredit and the proposed Nigeria Infrastructure Finance and Guarantees Platform, which aim to de-risk investments and create a “bankable pipeline” of infrastructure projects.

On his part, Mansur Muhtar, BOI Chairman called for deeper collaboration among public institutions, private investors, and development partners to create an environment conducive to inclusive and sustainable growth.

He said the BOI remained committed to its mandate of driving industrialisation and supporting businesses through innovative and responsible lending.

“At the Bank of Industry, we believe that inclusive and sustainable investment-led growth is not just a goal, it is a necessity. Our mission is to drive industrial transformation by supporting enterprises, deepening sectoral linkages, and embracing technology to unlock new opportunities,” Muhtar said.

He noted that the BOI Development Lecture Series had become an intellectual forum for shaping Nigeria’s future, serving as a meeting point for policymakers, investors, academics, and civil society to share ideas on how to move the country’s development finance agenda forward.

“This platform is about rethinking how we fund and drive Nigeria’s development. The challenges of today from digital disruption and global economic uncertainty to climate change demand that we innovate in how we finance progress and build stronger institutions.”

Muhtar emphasised that Nigeria’s financial institutions must evolve from being traditional lenders to becoming development catalysts capable of providing both financial and non-financial support to enterprises.

He said the BOI was already pursuing this vision through targeted interventions for small businesses, women entrepreneurs, and technology-driven enterprises.

“Through our programmes, we are demonstrating that development finance is not only about disbursing loans.

“It is about enabling businesses to scale, build capacity, and become globally competitive. It is about supporting the real economy, the farmers, manufacturers, innovators, and creators who make up the backbone of our society,” he added.

Muhtar also commended the growing collaboration between the BOI, the World Bank, and other development finance institutions in Nigeria.

“As stakeholders in Nigeria’s future, we have a shared responsibility to explore more innovative financing models.

“We must build stronger institutions, promote inclusive growth, and ensure that every Nigerian, regardless of background, feels the impact of development,” he added

Also speaking, Olasupo Olusi, BOI Managing Director, said the event reflects the institution’s evolving role as a strategic partner in shaping Nigeria’s development narrative.

The BOI chief noted that the annual public lecture, which began last year has become a thought-leadership platform for generating ideas that strengthen Nigeria’s development ecosystem.

“This year’s theme is both timely and urgent. The global economy is shifting rapidly from climate pressures to digital disruption and from evolving trade patterns to growing demands for inclusive growth. Nigeria cannot afford to stand still,” Olusi said.

He stressed that development finance must move beyond project-based lending to become an enabler of structural transformation, capable of unlocking private capital, driving innovation, and ensuring that economic growth translates into real improvements in citizens’ lives.

According to him, the focus of Nigeria’s development finance institutions should align with President Bola Tinubu’s Renewed Hope Agenda, which envisions a resilient and sustainable economy that empowers people and fosters innovation.

The event, themed, “Development Finance Imperatives: Rethinking Nigeria’s Path Forward,” was attended by key stakeholders in the financial sector including the Abdul Kamara, Director-General, African Development Bank, Nigeria Office, Ayo Sotinrin, Managing Director of Bank of Agriculture, and Sarah Alade, a former Deputy Governor of the Central Bank of Nigeria.

Source: Business Day