It is widely proclaimed, and generally believed, that access to finance is the biggest single problem facing Micro, Small and Medium Enterprises in Nigeria. Many experts cite the counter narrative that shortage of technical know-how, executive capacity and limited market opportunities are far bigger obstacles to entrepreneurial success.

Be that as it may, the Federal Government remains unrelenting in its search for solutions to the financial problems of Small Business Owners and Independent Professionals. It has a growing range of policies and programmes that seek to provide debt and equity support for new entrepreneurs through access to soft loans.

In pursuit of this objective, in furtherance of his campaign for re-election in 2019 for a second term of four years, President Muhammadu Buhari recently said his administration will establish an Entrepreneurs Bank which will offer cheap funds for Micro, Small and Medium Enterprises.

This plan raises one question: Is a new bank for entrepreneurs the answer to the problem of financing small businesses in Nigeria?

The track record of institutions created for the same reason and purpose suggest otherwise.

Nigeria now has not fewer than three development finance institutions, each specially set up for the sole purpose of lending investible monies to entrepreneurs. Fully or partly owned and funded by the Federal Government, they include the following:

1. Bank of Industry, currently Nigeria’s leading development Bank, focuses on lending to such industrial and value-adding sectors as manufacturing, agro-processing and entertainment. It extends credit to entrepreneurs at about Nine percent interest rate.

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