LAGOS — The UK government has backed a new initiative aimed at unlocking millions of dollars in domestic investment for female-led businesses in Nigeria, addressing a deep credit gap that disproportionately affects women entrepreneurs.
Under the partnership, financial sector development organisation FSD Africa — funded by the British High Commission in Nigeria — has committed $335,000 (£247,000) to launch the RiTA Investment Network.
The platform, created by pan-African angel investor network Rising Tide Africa, aims to raise $2.7m (3.75 billion naira) from local high-net-worth individuals, angel investors, and family offices over the next three years to finance 15 growing companies. Small and growing businesses form the backbone of Africa’s largest economy, but structural barriers leave many unable to access traditional bank loans. According to International Finance Corporation (IFC) estimates, Nigerian small businesses face a financing shortfall of around 13 trillion naira, with 95% unable to secure formal credit. Women entrepreneurs, who own roughly 40% of the country’s small enterprises, face even steeper hurdles and are rejected for loans at more than three times the rate of men. Banks frequently require physical collateral, such as land or real estate titles, which many women do not own.”Women entrepreneurs are building successful businesses across Nigeria, but many still face barriers to accessing the investment they need to grow,” said Paul Healey, Head of Green Growth and Private Sector Development at the British High Commission in Lagos. The project also targets a major currency risk facing African startups. Because much of the venture capital on the continent is denominated in US dollars, local businesses earning in naira face escalating debt burdens whenever the local currency depreciates. The new network will offer revenue-based financing in naira, allowing repayments to fluctuate with a company’s sales. This model provides growth capital without requiring owners to relinquish equity or pledge real estate as security.”Nigeria does not lack capital,” said Juliet Munro, Director for Early-Stage Finance at FSD Africa. “The RiTA Investment Network gives that capital the structure and instrument to grow, in Naira, and at scale.”The initiative completed its first transaction in September, backing a waste management company in Lagos, with two further deals currently undergoing due diligence.
Organisers hope the platform will serve as a stepping stone toward launching a broader $10m local-currency growth fund for women-led businesses across Nigeria.
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