CIBN urges nationwide SME hubs as banks face pressure to tur

Nigeria’s banking industry must channel its stronger capital base into small businesses, production and job creation, while policymakers should establish scalable Small and Medium Enterprise (SME) hubs nationwide to ensure that the gains from economic reforms reach businesses and households, the Chartered Institute of Bankers of Nigeria (CIBN) has said.

The call dominated discussions at the opening of the 19th Annual Banking and Finance Conference of the CIBN in Abuja on Tuesday, as bankers, regulators, government officials and development experts examined how to make Nigeria’s economy more resilient amid geopolitical, technological and domestic disruptions.

The conference, themed “Building a Resilient Economy in an Era of Disruptions: Strategic Imperatives for the Banking and Financial Services Industry,” is being held at the Congress Hall of the Transcorp Hilton, Abuja.

President and Chairman of the Council of the CIBN, Dr Dele Alabi, said the next phase of Nigeria’s reform programme should focus on transmitting macroeconomic stability to the balance sheets of businesses and households.

He proposed the development of SME hubs tailored to the comparative advantages of different regions, combining shared infrastructure, business advisory services, skills development, technology support, market linkages and access to finance.

“MSMEs are central to employment, enterprise and local value creation, but many remain constrained by high operating costs, unreliable infrastructure, limited access to markets, low productivity, skills gaps and slow digital adoption,” Alabi said.

According to him, the hubs would lower operating costs, improve the bankability of businesses and make it easier for recapitalised banks to finance productive activities.

The proposal comes against increasing pressure on banks to deploy the additional capital raised during the sector’s recapitalisation exercise to the real economy.

The Central Bank of Nigeria said 33 banks met the revised minimum capital requirements after raising N4.65 trillion in fresh capital over the 24-month exercise. The Securities and Exchange Commission said the capital-market exercise mobilised the funds largely through domestic and international investors.

President Bola Tinubu, represented at the conference by Finance Minister and Coordinating Minister of the Economy Taiwo Oyedele, challenged financial institutions to move beyond balance-sheet growth and profitability to finance businesses, production and employment.

The President argued that Nigeria could not achieve sustainable prosperity if banks concentrated excessively on government securities and short-term returns rather than productive investment.

The call was reinforced by the World Bank, which urged banks to direct more credit towards sectors with strong job-creation potential, particularly agriculture, manufacturing and MSMEs. The bank noted that between three and four million young Nigerians enter the labour market each year, making access to productive finance increasingly critical.

Alabi said the reform gains were beginning to show in Nigeria’s financial and macroeconomic indicators. He cited the N4.65 trillion banking recapitalisation, the improvement in Nigeria’s sovereign outlook by Moody’s from stable to positive while retaining a B3 rating, the country’s scheduled return to FTSE Russell Frontier Market status on September 21, and 4.43 per cent real GDP growth in Q2 2026.

But he cautioned that these remained milestones rather than the final measure of reform success.

“The true test is whether stronger fundamentals translate into lower living costs, more jobs, higher real incomes, affordable credit, reliable public services and reduced poverty,” he said.

He also warned that Nigeria remained exposed to global disruptions, including geopolitical tensions affecting energy and shipping, higher freight costs, exchange-rate pressures and shifts in international capital flows.

Managing Director and Chief Executive Officer of the Nigeria Deposit Insurance Corporation, Mr Thompson Oludare Sunday, represented at the conference, said resilience required collaboration among regulators, banks, fintech companies, payment providers and professional bodies.

He urged the banking industry to maintain financing for entrepreneurship, agriculture, manufacturing, infrastructure and other productive sectors while strengthening cybersecurity, governance, technology and depositor protection.

CBN Governor Olayemi Cardoso, represented by Deputy Governor Philip Ikeazor, also stressed the importance of a strong banking system to economic resilience and urged stakeholders to work together to bring inflation down.

With stronger bank capital now available, the central question emerging from the conference is whether Nigeria can convert that financial strength into cheaper and more accessible productive credit.

For CIBN, nationwide SME hubs could provide the missing bridge between bank recapitalisation and real-sector growth, enabling more businesses to become bankable, productive and capable of creating the jobs required to make Nigeria’s economic recovery felt beyond headline macroeconomic indicators.