114
The Federal Government has announced plans to list at least 1,000 Small and Medium Enterprises (SMEs) on the Nigerian capital market as part of efforts to expand access to long-term financing, stimulate economic growth, and tackle unemployment.
This follows the signing of a Memorandum of Understanding (MoU) between the Securities and Exchange Commission (SEC) and the Small and Medium Enterprises Development Agency of Nigeria (SMEDAN) in Abuja.
The partnership is designed to deepen collaboration between both institutions in creating financing alternatives for Nigeria’s over 40 million registered Micro, Small, and Medium Enterprises (MSMEs), many of which struggle to access affordable credit.
According to both agencies, the initiative will “galvanize growth, create wealth, and reduce unemployment in Nigeria,” while also advancing President Bola Tinubu’s administration’s goal of achieving a $1 trillion economy.
Under the MoU, SMEs that meet regulatory and governance standards will be supported to raise capital through equity or debt securities in line with SEC guidelines. The move will also integrate more small businesses into the formal financial system and promote transparency and accountability.
The Director-General of the SEC, Dr. Emomotimi Agama, said the collaboration represents a major step toward building a sustainable financing structure for SMEs and enabling them to become part of the capital market ecosystem.
“Capital is the bedrock of any company,” Agama said. “Today, we have about 40 million SMEs duly registered with SMEDAN. It is important that as a capital market, we create a route for them to raise capital for sustainability. We want to bring them on board the pipeline of listed companies where they can democratize wealth and accelerate development.”
Agama added that the partnership aligns with the Federal Government’s economic reform agenda, which prioritizes industrial expansion, inclusive growth, and job creation.
On his part, the Director-General of SMEDAN, Mr. Charles Odii, said the collaboration will help address the chronic problem of limited and costly financing that has constrained the growth of SMEs across the country.
“Capital in this part of the world is very expensive and scarce,” Odii noted. “Through this collaboration, we are creating another source of financing for medium-scale businesses. We have set a target of at least 1,000 SMEs listing on the capital market. This will galvanize growth, create wealth, and reduce unemployment in Nigeria.”
Under the agreement, the SEC and SMEDAN will jointly organize capacity-building programmes to strengthen SMEs’ financial literacy, governance structures, and understanding of capital market operations.
The SEC will also contribute to SMEDAN’s five-year strategic policy framework to promote inclusive financing and SME-friendly market policies, while SMEDAN will identify and guide qualified SMEs for listing on recognized exchanges.
Additionally, the collaboration will enable eligible SMEs to issue debt securities to qualified investors, expanding their funding options beyond traditional bank loans.
A three-day National SME Conference will be convened jointly by both agencies to engage stakeholders, promote market opportunities, and encourage dialogue on policy reforms for SME financing.
The MoU also establishes a Joint Working Group (JWG) to oversee implementation and ensure effective data sharing between both institutions, in line with the Nigeria Data Protection Act, 2023.
Through this partnership, the Federal Government hopes to unlock the full potential of Nigeria’s SME sector as a key driver of innovation, job creation, and national economic growth.
