UK commits $335,000 to drive investment in Nigerian women-led businesses

The United Kingdom Government has committed $335,000 to establish the RiTA Investment Network, a new platform designed to channel more domestic investment into women-led businesses in Nigeria.

The initiative, supported through the British High Commission in Nigeria, is being established by Rising Tide Africa, a pan-African network of women angel investors, with the aim of mobilising $2.7 million, equivalent to about N3.75 billion, from Nigerian investors.

According to a statement by the British High Commission, the funding is expected to support 15 small and growing women-led businesses across the country, helping them secure capital to expand their operations.

Addressing persistent financing challenges

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.

According to the statement, the International Finance Corporation (IFC) estimates that Nigerian small businesses face a financing gap of about N13 trillion, with 19 in 20 unable to access formal finance.

It noted that 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, Head of Green Growth and Private Sector Development at the British 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.

• “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,” he said.
• “Together, we are building stronger connections between women-led businesses and investors, creating opportunities for more businesses to start, grow, and thrive.”

Healey 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.

Platform to mobilise domestic capital

Juliet Munro, Director for Early-Stage Finance at FSD Africa, said the network could help mobilise domestic capital and channel it into businesses requiring growth financing.

• “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,” Munro said.

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.

Although Nigeria has substantial private wealth, the statement noted that relatively few channels connect domestic investors with smaller businesses seeking growth capital.

The RiTA Investment Network aims to bridge that gap by establishing a formal investment platform supported by professional credit assessments, an investment committee, an advisory board, and monitoring and reporting systems to give investors greater confidence.

Rising Tide Africa’s members have collectively backed 39 companies to date, drawing on their experience in investing in women-led businesses.

RiTA targets $10 million in local-currency funding

Yemi Keri, General Partner at the RiTA Investment Network, said the UK-backed investment would support the platform’s ambition to raise $10 million in local-currency funding for women-led enterprises in Nigeria.

• “Women led businesses in Nigeria are growing, and they need lenders who understand how they work. We founded RiTA to give investors a disciplined way to lend to them, one business at a time. FSD Africa’s support lets us build the structure, the discipline and the data to do this at scale,” she said.

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 $1.5 million in soft commitments from its network, according to the statement.

UK highlights Nigeria’s capital market reforms

The investment comes amid broader efforts to deepen Nigeria’s capital markets and mobilise domestic and international financing for businesses and infrastructure.

The UK has said Nigeria’s plans to strengthen its capital markets through a 10-year roadmap could unlock investment opportunities, support job creation and promote shared prosperity in both countries.

The RiTA Investment Network adds to efforts to connect private capital with smaller businesses, particularly women-led enterprises that face difficulties accessing conventional financing.