The African Export-Import Bank has signed a $75 million facility agreement with the Development Bank of Nigeria (DBN). The facility aims to expand low-interest credit for domestic small businesses. It targets fashion, film and music. The sectors are labour-intensive and youth-heavy. They are also dollar-earning in creative exports. The facility is welcome. The test is whether the money reaches tailors, filmmakers and musicians, not just balance sheets.
The historical echo is the 2010 intervention funds for manufacturing and small businesses. Many of those funds were captured by large borrowers or stalled in banks. The winners are DBN, Afreximbank and small businesses that can access the credit. The losers are borrowers who lack collateral and banks that prefer safer customers.
Winners: DBN, Afreximbank, creative small businesses with collateral.
Losers: Informal creatives, borrowers without collateral.
Bottom Line: A $75 million facility can widen access. Without simpler collateral rules, it will fund the same businesses that already have bank relationships.