UK commits funds to new Nigerian platform launched to back women-led businesses

BRITAIN has committed a sum of $335,000 towards establishing a new platform designed to channel more domestic investment into women-led businesses in Nigeria to be known as the RiTA Investment Network.

Designed to channel more domestic investment into women-led businesses in Nigeria, the new initiative, supported through the British High Commission in Nigeria, is being established by Rising Tide Africa, a pan-African network of women angel investors. It aims to mobilise $2.7m from Nigerian investors to support 15 small and growing women-led businesses across the country.

According to the high commission, the initiative seeks to address persistent financing challenges facing Nigerian small businesses, particularly those owned by women, who often struggle to meet conventional lending requirements. This is based on the International Finance Corporation (IFC) estimate that Nigerian small businesses face a financing gap of about N13trn, with 19 in 20 unable to access formal finance.

Across Nigeria, women entrepreneurs face additional barriers, despite owning around 40% of the country’s small businesses, as they are rejected for credit at more than three times the rate of men, according to the statement. For many women-owned businesses, the challenge is not necessarily their ability to run profitable enterprises or repay loans, but the lack of collateral, such as land, traditionally required by banks.

Paul Healey, the head of green growth and private sector development at the high commission, said the initiative forms part of the UK government’s broader efforts to expand access to finance for promising small and growing businesses. He added that the partnership would help create jobs and support Nigeria’s economy by connecting entrepreneurs with investors and laying the groundwork for further investment in women-led enterprises.

Mr Healey said: “Women entrepreneurs are building successful businesses across Nigeria but many still face barriers to accessing the investment they need to grow. This partnership between the UK Government, FSD Africa and Rising Tide Africa is changing that and together, we are building stronger connections between women-led businesses and investors, creating opportunities for more businesses to start, grow, and thrive.”

Juliet Munro, the director for early stage finance at FSD Africa, added: "Nigeria does not lack capital. Women angel investors in Rising Tide Africa have shown for years that they will back women-led businesses with their own money. The RiTA Investment Network gives that capital the structure and instrument to grow, in Naira, and at scale.”

She pointed out that the initiative is designed to address the currency risks associated with dollar-denominated financing for businesses that generate revenue in naira. When the naira weakens, servicing dollar debt becomes more expensive for these businesses.

Rising Tide Africa’s members have collectively backed 39 companies to date, drawing on their experience in investing in women-led businesses. Yemi Keri, the general partner at the RiTA Investment Network, said the UK-backed investment would support the platform’s ambition to raise $10m in local-currency funding for women-led enterprises in Nigeria.

FSD Africa’s funding will cover the cost of establishing the network during its first three years, including its team, legal structure, governance and operating systems, before it becomes self-sustaining through fees. Rising Tide Africa has already secured about $1.5m in soft commitments from its network.