Agency plans microfinance bank, entrepreneurship polytechnic, $12bn funding pipeline for small businesses
The Director-General of the Small and Medium Enterprises Development Agency of Nigeria (SMEDAN), Charles Odii, has outlined an ambitious reform agenda for Nigeria’s Micro, Small and Medium Enterprises (MSMEs) in 2026, with a focus on large-scale business formalisation, skills development and expanded access to low-cost financing.
Odii made the disclosure on Wednesday in Abuja during a press briefing where he reviewed SMEDAN’s performance in 2025 and unveiled priorities for the coming year.
He announced that the agency is seeking regulatory approval from the Central Bank of Nigeria (CBN) to operate a microfinance bank, as well as clearance from the Federal Ministry of Education to establish a polytechnic and mono-technic offering diploma programmes in entrepreneurship and business education.
According to the SMEDAN boss, many of the initiatives slated for 2026 have been in development for nearly two years and are now ready for implementation.
“One major lesson from 2025 is that good things take time. In 2026, Nigerians will begin to see the results of initiatives that have been carefully prepared over the last 18 to 24 months,” Odii said.
Push to formalise one million businesses
Odii disclosed that by the first quarter of 2026, SMEDAN expects to have formalised 250,000 new businesses, adding that discussions are ongoing with the Presidency to extend the programme to cover an additional one million enterprises.
He said Nigeria currently has an estimated 39.6 million nano, micro, small and medium enterprises, a figure expected to rise significantly as formalisation efforts intensify.
“We will get new small businesses, and we will formalise existing ones. The formalisation process to be unveiled in 2026 will expand the MSME ecosystem significantly,” he said.
Formalisation, he explained, allows businesses to access bank accounts, build credit histories and qualify for loans and government support.
New MSME policy under review
The SMEDAN DG also revealed that the National MSME Policy, which provides a five-year framework for the sector, is currently under review and expected to be finalised by December 31, 2025.
He said the draft policy will be shared with stakeholders, including business owners, for input before submission to the President and the Federal Executive Council.
“Small businesses must have a voice in policies that affect them,” Odii stressed.
Funding, training and inclusion initiatives
On financing, Odii said SMEDAN is brokering $12 billion in affordable funding aimed at expanding access to capital for more than three million SMEs nationwide.
He added that about 6,000 businesses have been trained under the agency’s ICSS curriculum, with plans to double or quadruple that number in 2026.
SMEDAN is also implementing programmes to reintegrate former inmates into the workforce by providing skills training six months to one year before their release, to improve employability and reduce recidivism.
Infrastructure expansion and job creation
To tackle challenges such as lack of workspace, equipment and reliable power, SMEDAN has upgraded several industrial development centres in Abuja, Katsina, Osun and Ikorodu.
The hubs provide affordable workspaces, tools and electricity for small businesses. Odii said the agency plans to replicate the model nationwide, targeting 774 operational centres to support job creation and reduce unemployment and insecurity.
2025 milestones
Highlighting achievements in 2025, Odii said:
- Over 18,000 nano-businesses benefited from SMEDAN’s Conditional Grant Scheme;
- 3,100 companies received grants and loans under the One Local Government, One Product initiative;
- More than 260,000 businesses were formally registered nationwide;
- Over N12 billion in single-digit interest loans was mobilised through partnerships with states and commercial banks in Enugu, Kaduna, Katsina and Zamfara;
- More than 14,000 businesses were trained in financial literacy, export readiness and AfCFTA-related opportunities.
He also noted that the National Reach Competition continues to fund viable business ideas on a quarterly basis, disbursing millions of naira to entrepreneurs.
2026 priorities
- Odii outlined five core focus areas for 2026:
business formalisation, policy implementation, access to funding, capacity development, and infrastructure expansion. - He emphasised the connection between economic empowerment and national security.
- “Hunger leads to anger; anger leads to violence. By supporting SMEs, we can address insecurity at its root,” he said.
- The SMEDAN DG urged small business owners and stakeholders to actively engage with the agency and leverage its programmes as reforms roll out in 2026.
- MSMEs account for over 90 per cent of businesses in Nigeria and employ tens of millions of people, but the sector continues to face challenges such as limited access to finance, weak infrastructure and skills gaps.
SMEDAN’s proposed microfinance bank and entrepreneurship-focused tertiary institutions signal a shift toward more direct intervention in funding and skills development, positioning small businesses as a central pillar of Nigeria’s economic recovery, job creation and security strategy.
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