The Dutch EntrepreneurialDevelopment Bank (FMO) and Nigerias First City Monument Bank (FCMB) have signed a $25 million NASIRA guarantee agreement.
The guarantee will enable FCMB to expand its funding to agriculture, youth, and women-owned SMEs without requiring collateral, targeting a client group typically deemed too risky by banks.
Funded by the European Commission, NASIRA is one of FMOs most innovative programs, encouraging local banks to extend their funding to small entrepreneurs without collateral. Often, the FMO guarantee - that effectively replaces the collateral - is not fully utilized, demonstrating that these entrepreneurs, primarily women and young people, are not riskier than others.
In addition to the $25million NASIRA guarantee, FMO will support FCMB with a syndicated loan of $60 million, comprising $20 million through FMO, $30 million through the European Financing Platform on behalf of BIO, DEG, EIB, FINNFUND, Proparco, and SWEDFUND, and $10 million through FMO Investment Management.
The loan is dedicated to growing the existing FCMB loan portfolio of small and medium-sized entrepreneurs (SMEs).
