CBN Targets DFI Recap, FG Rolls Out Mass Savings to Bridge ₦130tn MSME Gap

The Central Bank of Nigeria (CBN) has announced plans to recapitalise and restructure Development Finance Institutions (DFIs) as part of a broader strategy to close Nigeria’s widening credit gap for micro, small and medium-sized enterprises (MSMEs).
The Deputy Governor of the CBN in charge of Economic Policy, Muhammad Abdullahi, disclosed this during a panel session at the launch of the Nigeria Development Update organised by the World Bank in Abuja.
Abdullahi explained that a recent review of the country’s development finance architecture revealed that existing DFIs remain significantly undercapitalised and incapable of meeting rising credit demands from the real sector.
According to him, the combined asset base of all DFIs in Nigeria currently stands at just over ₦8 trillion, a figure that falls far short of what is required to adequately support MSME growth and economic expansion.
“Across all the DFIs in Nigeria, the total asset base is slightly above ₦8tn, whereas what is required in development finance for MSMEs is over ₦130tn,” he stated.
He noted that the funding mismatch has created a structural constraint in Nigeria’s credit market, limiting access to affordable financing for small businesses that form the backbone of employment and industrial growth.
As part of reforms, the apex bank said it is now considering recapitalisation measures and institutional restructuring to strengthen DFIs and enhance their capacity to deliver targeted development financing.
FG Unveils Mass Savings Scheme
In a parallel reform effort, the Federal Government has unveiled plans for a nationwide mass savings scheme designed to mobilise domestic capital, reduce reliance on borrowing, and deepen investment participation among citizens.
The Minister of Finance and Coordinating Minister of the Economy, Wale Edun, said the initiative will enable Nigerians across all income levels to save, invest, and earn returns while contributing directly to national economic growth.
Edun explained that the programme is designed to channel household savings into productive sectors, including infrastructure, large-scale enterprises, and listed companies, thereby expanding the country’s investment base.
“There are mass savings schemes which allow people at all levels of society to save and earn unearned income, including from companies such as refineries and other large firms listed on the stock exchange,” he said.
He added that the government is increasingly prioritising domestic savings mobilisation and equity participation as alternative financing tools to complement public revenue and reduce pressure on external borrowing.
According to him, the reforms align with broader fiscal restructuring efforts aimed at improving revenue tracking, strengthening expenditure discipline, and crowding in private sector investment.
Economic Outlook
Analysts say the dual strategy—DFI recapitalisation and mass savings mobilisation—signals a shift toward a more domestically driven financing model, particularly as Nigeria seeks to expand credit access for MSMEs and reduce its infrastructure funding deficit.
The initiatives were highlighted during discussions at the World Bank’s Nigeria Development Update, which brought together policymakers, development partners, and financial sector stakeholders in Abuja.
CBN plans recapitalisation of Development Finance Institutions to bridge a ₦130tn MSME funding gap, while FG unveils a mass savings scheme to boost domestic investment and reduce reliance on borrowing.