Group advocates smart lending to empower women entrepreneurs in Nigeria

A global non-profit group, Women’s World Banking (WWB), is advocating smart lending practices to intensify efforts to narrow the gender gap in Nigeria’s financial inclusion.

The group said this “transformative approach” streamlines credit processes by combining technology and education, making them more efficient and accessible for women entrepreneurs.

WWB focuses on advancing women’s economic empowerment globally.

The group hosted a workshop in Lagos on 5 February on the theme “Advocacy Convening: Smart Lending—Business Skills and Digital Capabilities for Smarter Borrowing and Better Outcomes.”

According to a statement sent to PREMIUM TIMES on Tuesday, the workshop brought together financial institutions and industry experts to strategise on equipping women with business and digital skills.

The statement, quoting a PwC report, said that despite Nigerian women managing over 23 million microbusinesses, only 10 per cent have access to formal financial loans.

The statement said this limited access stifles their potential in a sector where they represent 41 per cent of microbusiness owners.

“The goal is not just to provide productive funding but to equip women with the skills and tools needed for long-term financial success,” said Angela Wambugu, WWB’s director of advisory Services for Africa.

“By combining business education with digital innovation, WWB, alongside our partners, aims to unlock the financial potential of millions of women entrepreneurs across Nigeria.”

Technology is at the heart of this transformation. Ngozi Ndefo, WWB’s associate of advisory services for Africa, highlighted its power: “Women play a vital role in Africa’s economy, especially in Nigeria, where many are microbusiness owners. However, barriers such as low digital skills and limited access to financial services hinder their ability to scale.”

She added, “Digital solutions, such as mobile banking and financial literacy apps, can significantly reduce these barriers. Smart lending, with its focus on proper bookkeeping, financial literacy, and digital tools, not only reduces default rates but also strengthens relationships between financial institutions and borrowers.”

Challenges

Financial literacy remains a major challenge in Nigeria, where, according to the Central Bank of Nigeria, only 38 per cent of adults are financially literate, and 40 per cent lack access to banking services.

Barriers such as limited access to smartphones exacerbate the issue for women. While 88 per cent of Nigerian women own mobile phones, only 23 per cent use smartphones.

“Tailored or personalised digital solutions present a clear opportunity to turn this into an advantage,” Ms Ndefo said. “Financial institutions must design tools that cater to women’s specific needs, ensuring both accessibility and security.”

Jennifer Iwueze, WWB’s regional research lead for Africa, stressed the critical role of data-driven solutions.

“Thorough research ensures that loan products and training programmes align with customer capacities,” she said.

“Segmentation, for instance, helps institutions design solutions that are age- and literacy-appropriate, reducing the risk of non-performing loans.”

She added, “It is not enough to introduce digital services. Organisations must first understand whether their customers are ready for such tools.”

WWB is collaborating with FCMB Microfinance Bank on smart lending.

“Since adopting smart lending principles, FCMB has introduced initiatives such as health insurance, digital credit, and financial literacy programs tailored to women’s needs,” said Fred Nwakolo, acting managing director of FCMB Microfinance Bank.

He shared a success story of a female borrower who accessed a N50,000 loan and later benefited from N300,000 in health insurance during a hospital stay.

“This support enabled her to recover and resume her business without financial strain,” he noted.

According to the statement, the FCMB has reduced loan disbursement times from two days to five hours, with plans to streamline further to two-hour disbursements.

Paul Adu, the managing director of NUT Oke-Bola Microfinance Bank, echoed the importance of collaboration, sharing his institution’s commitment to raising the proportion of female borrowers from 73 to 80 per cent through more inclusive offerings.

“The training provided practical tools for creating customer-centred products that address women’s unique financial needs,” he said.

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Hundred million target in 2027

WWB was founded in 1979.

According to the statement, the group has transformed over 83 million lives in emerging markets through access to financial products and services.

In Nigeria, the group said it is collaborating with the Central Bank of Nigeria and other stakeholders to develop frameworks prioritising women’s financial inclusion, particularly in underserved communities.

The group said their target is to empower 100 million women by 2027 through driving inclusive growth that benefits households, businesses, and communities worldwide.