The Securities and Exchange Commission (SEC) and the Small and Medium Enterprises Development Agency of Nigeria (SMEDAN) have entered into a partnership to expand access to long-term financing for small and medium enterprises through the Nigerian capital market.
The agreement, signed in Abuja, seeks to open up alternative funding channels for over 40 million registered micro, small, and medium enterprises across the country, enabling them to grow, create jobs, and support the Federal Government’s $1 trillion economy target.
Speaking during the signing ceremony, SEC Director-General, Emomotimi Agama, said the collaboration would give small businesses new opportunities to raise capital and integrate more enterprises into the capital market ecosystem. He explained that the move would also encourage more SMEs to list on the stock exchange, promoting shared ownership, wealth creation, and economic development.
“Capital is the bedrock of any company. Today, we have about 40 million small and medium enterprises registered with SMEDAN. It is important that, as a capital market, we find a route for these enterprises to raise capital for sustainability,” Agama said.
He added that the partnership aligns with President Bola Tinubu’s economic agenda focused on growth, employment, and production, describing it as a key step toward achieving the administration’s trillion-dollar economy vision.
SMEDAN’s Director-General, Charles Odii, described the initiative as a significant breakthrough for small businesses struggling with limited access to affordable financing. He noted that the partnership would provide fresh opportunities for businesses to secure funds and participate in the capital market.
“Capital in this part of the world is very expensive and scarce. Through this collaboration, we are creating another source of financing for our medium-scale businesses. We have set ourselves a target of at least 1,000 SMEs listing on the capital market. This will galvanise growth, create wealth, and reduce unemployment in Nigeria,” Odii stated.
The Memorandum of Understanding is designed to integrate small businesses into the formal financial system and help them meet governance and regulatory standards required to raise funds. It includes initiatives to support qualified SMEs in accessing long-term capital through equity or debt instruments under SEC supervision.
The agreement also provides for capacity-building programmes, as both agencies plan to organise training and awareness sessions focused on financial literacy, corporate governance, and market participation. Additionally, the SEC will support SMEDAN’s five-year strategy to promote inclusive financing and SME-friendly policies, while SMEDAN will help identify credible businesses eligible for listing on recognised exchanges.
Under the arrangement, qualified SMEs will also be able to issue debt securities to investors, offering an alternative to bank loans. Both institutions intend to jointly host a national SME conference to engage stakeholders, promote investment opportunities, and deepen discussions on market policies.
A Joint Working Group will oversee implementation and ensure compliance with data-sharing and protection standards in line with the Nigeria Data Protection Act, 2023.
