E-Financial
Banks’ Funding Failure: The Shocking Rot In Nigeria’s Intervention Programmes
By Blaise Udunze
For over a decade, the Nigerian government and its financial institutions have launched a flurry of intervention funds, all with the promise to empower industries, revive the manufacturing sector, and lift millions of micro, small, and medium enterprises (MSMEs) out of financial drought. From agriculture to aviation, from creative industries to export promotion, these funds were designed as catalysts for inclusive growth and job creation.
But today, the story reads like a tragic irony. Trillions of naira later, there is little impact to show. Factories remain underutilized, MSMEs struggle to survive, and unemployment continues to soar. The rot runs deeply entrenched corruption, politicization, poor monitoring, and widespread loan defaults have turned what should have been Nigeria’s economic lifeline into a cautionary tale of mismanagement and missed opportunities.
The Central Bank of Nigeria (CBN) and the Bank of Industry (BOI) have, over the years, spearheaded multiple intervention programmes. In 2013, the N220 billion MSME Development Fund (MSMEDF) was launched to empower small businesses, with a special 60 percent allocation for women. Yet, more than a decade later, thousands of genuine entrepreneurs say they never accessed the fund, while others question the transparency of disbursement. The Anchor Borrowers’ Programme (ABP), launched in 2015, aimed to link smallholder farmers to processors and was hailed as a masterstroke for agricultural self-sufficiency. Over N1 trillion reportedly flowed into the scheme. But the dream soon dimmed with ghost beneficiaries, political interference, and poor loan recovery exposed a programme riddled with abuse.
Similarly, the Agri-Business/Small and Medium Enterprises Investment Scheme (AGSMEIS), a CBN-backed initiative pooling five percent of banks’ profit after tax, began as a noble effort to stimulate SMEs. However, its later years were marred by disbursement bottlenecks and allegations of insider favoritism. Commercial banks and some designated financial institutions, instead of acting as facilitators, became gatekeepers of corruption. Bribes, favoritism, and endless paperwork became the norm. Funds meant for productive ventures were sometimes redirected to political allies or misapplied by the very institutions entrusted with disbursement.
Rather than empowering Nigeria’s real economy, intervention loans too often empowered a network of insiders who saw the programmes as avenues for rent-seeking. The impenetrability of these schemes made them convenient channels for political reward and institutional looting. Once the funds leave government coffers, tracking them becomes an exercise in futility. There are no reliable public databases showing who got what, how much was repaid, or what impact was achieved.
The rot is not confined to agriculture. The Creative Industry Financing Initiative (CIFI), launched in 2019 to nurture Nigeria’s entertainment and digital sectors, became mired in controversy over opaque selection and limited reach. The Real Sector Support Facility (RSSF) and the Textile Sector Intervention Fund, meant to boost manufacturing and revive the textile industry, also suffered from weak monitoring and low repayment discipline. During the pandemic, the N400 billion COVID-19 Targeted Credit Facility (TCF) was touted as a lifeline for households and small firms. Administered by NIRSAL Microfinance Bank, it sparked hope among struggling entrepreneurs, but soon, the familiar patterns emerged as connected elites got the funds, while genuine applicants were locked out.
Official data reveals that the CBN has disbursed over N10.3 trillion across various interventions in less than a decade with an unprecedented scale of funding. When combined with BOI-managed programmes such as the Government Enterprise and Empowerment Programme (GEEP) and the Export Expansion Facility Programme (EEFP), total earmarked intervention funds likely exceed N12 trillion. Yet, Nigeria’s industrial contribution to GDP remains below 10 percent, and MSMEs with the supposed beneficiaries continue to struggle with high costs, poor infrastructure, and limited credit access.
Over the years, numerous intervention funds have been launched to support industries and MSMEs from the N220 billion MSME Development Fund and N300 billion Real Sector Support Facility to the N200 billion SME Restructuring and Refinancing Fund. However, poor administration, corruption, and diversion have undermined these initiatives. A 2023 report by the Auditor-General revealed that billions of naira from these schemes were either unaccounted for or misapplied, with funds channeled through commercial banks that prioritized profit over impact.
For instance, the CBN’s N220 billion MSME Development Fund has only seen about N83 billion disbursed over seven years. The Survival Fund, though lauded in principle, has delivered roughly N67.5 billion to over 1.25 million beneficiaries, including cases where mobilisation fees were collected but goods or services never followed. An N5 billion SME loan fund through SMEDAN and Sterling Bank saw only N250 million actually reach business owners. Even in interventions like BOI’s N75 billion Manufacturing Sector Fund, less than a third had been disbursed to manufacturers, with many applications still awaiting approval. These examples speak not to scarcity of funds, but to failures in administration, accountability, and access.
The cost of Nigeria’s failed intervention programmes goes beyond wasted billions; it has crippled the very sectors they were designed to rescue. Thousands of promising small businesses are left stranded without access to affordable credit, while manufacturers continue to struggle with obsolete equipment, erratic power supply, and prohibitive interest rates. Instead of catalyzing growth, these funds have deepened dependency, encouraged corruption, and distorted the credit market.
The result is a stunted industrial base, where innovation and expansion are sacrificed on the altar of bureaucracy and greed. Many entrepreneurs who could have scaled production or entered export markets have shut down under the weight of unmet promises. Jobs that could have been created remain mere statistics in policy documents, while Nigeria’s ambition to diversify its economy beyond oil continues to falter.
In the ongoing investigation into the Central Bank of Nigeria’s activities, news reports have uncovered that scrutiny may extend to Chief Executive Officers and senior management personnel of various banks. The investigation seeks to examine potential discrepancies related to the management of intervention funds by deposit money banks. This revelation follows reports that the CBN might be compelled to withdraw its released audited annual financial reports after investigators uncovered irregularities and inconsistencies.
This unfolding probe, led by Special Investigator Jim Obazee, who was appointed by President Bola Tinubu in July 2023 as this mark one of the most comprehensive financial examinations in Nigeria’s history. Obazee’s mandate extends beyond the CBN to include other Government Business Entities (GBEs), with the goal of plugging financial leaks and holding corrupt individuals accountable. According to the Secretary to the Government of the Federation, George Akume, the forthcoming audit report will shed light on governance failures that have long crippled Nigeria’s financial system.
One key revelation involves intervention funds totaling N1.27 trillion reportedly held in the accounts of five major banks: Access Bank, Fidelity Bank, Guaranty Trust Bank, United Bank for Africa, and Zenith Bank. These funds cover various CBN lending schemes, including the Commercial Agriculture Credit Scheme, Real Sector Support Facility, and state bailouts. Access Bank alone held about N530 billion in intervention funds, while Fidelity Bank retained roughly N310 billion.
Several banks have also been found to hold undisbursed funds from the CBN earmarked for programmes like the Anchor Borrowers’ Scheme and the Commercial Agriculture Credit Scheme. As of June 2023, Guaranty Trust Holding Company, Wema Bank, and Sterling Financial Holdings collectively held N114 billion in Anchor Borrowers’ funds, while seven banks, including UBA, Access, Zenith, and Fidelity, retained N94 billion from the agriculture credit scheme.
As the investigation progresses, bank executives were expected to be summoned for questioning. The revelations underscore the depth of systemic dysfunction, where funds meant for development sit idle or are diverted, while small businesses gasp for credit.
Amid the turbulence, the newly appointed CBN Governor Olayemi Cardoso called for a radical shift in the bank’s role. During his Senate screening, he emphasized the need to refocus the CBN on its core mandate of monetary stability rather than direct development finance. Cardoso warned that the CBN’s historical foray into fiscal interventions had blurred institutional boundaries and undermined credibility. His plan is to transition the bank toward a more limited advisory role, one that supports economic growth without entangling itself in politically driven lending.
This reorientation is timely. As of October 2022, nearly 10 trillion had already been disbursed as intervention funds, much of it tied to agriculture and small business support. Yet controversies over beneficiary selection, repayment defaults, and limited impact persist. Experts have urged a full-scale audit and restructuring of these programmes, recommending that future interventions be channeled through relevant ministries and agencies, not the CBN to ensure proper oversight and impact measurement.
Before the next bailout or recovery initiative is launched, both the CBN and BOI must clean house. This means full public disclosure of all beneficiaries, proper audits of past disbursements, and the recovery of misapplied or stolen funds. The impenetrability that has shielded corruption for years must give way to transparency, backed by digital tracking systems and citizen oversight.
Beyond cleansing their books, these institutions must also rethink their approach. Development finance should no longer be routed through rent-seeking commercial banks that profit without producing impact. Instead, direct digital lending platforms, strict eligibility verification, and measurable impact tracking should define the new model.
Nigeria’s intervention programmes must undergo radical reform anchored on transparency, technology, and traceability. Every fund should have a publicly accessible portal listing disbursements, beneficiaries, and repayment status. Periodic audits that are independently verified must be mandatory, not optional. Beyond financial engineering, Nigeria must fix the enabling environment for consistent power supply, logistics, security, and regulatory stability that makes business growth possible.
The shocking rot in Nigeria’s intervention programmes is not just a financial scandal; it is a betrayal of national trust. Trillions have been poured into schemes that promised jobs and prosperity, yet delivered little beyond paperwork and propaganda. Unless Nigeria cleans up the system, enforcing accountability and rewarding genuine productivity, its intervention funds will continue to fund failure, not progress.
Blaise, a journalist and PR professional writes from Lagos, can be reached via: [email protected]
The Central Bank of Nigeria has directed banks, fintech firms, and other payment service providers to store payment transaction data generated within the country on local servers from January 1, 2027, as part of new measures to strengthen oversight of the fast-growing digital payments ecosystem.
The directive was contained in a circular issued by the Payments System Supervision Department of the CBN on Monday and addressed to deposit money banks, microfinance banks, mobile money operators, switching and processing companies, payment terminal service providers, payment solution service providers, super agents and other licensed operators in the payments industry.
The circular, signed by the Director of the Payments System Supervision Department, Rakiya Yusuf, also introduced new market structure rules, beneficial ownership disclosure requirements and systemic oversight measures for payment service operators.
According to the apex bank, the reforms became necessary following the rapid expansion of electronic payments and digital financial services across the country.
The CBN said it had observed “significant structural developments within the Nigerian Payments ecosystem, characterised by rapid growth in electronic payments, increasing adoption of digital financial services, and the emergence of operators with substantial market presence across key payment activities.”
It noted that while the growth had improved innovation, efficiency and financial inclusion, it had also created concerns around market concentration, operational dependence, ownership transparency and the storage of critical payments data.
To address these concerns, the regulator ordered all financial institutions facilitating payments in Nigeria to ensure that transaction data generated within the country are stored domestically.
The circular stated, “All Financial Institutions and participants facilitating payments within Nigeria shall ensure that payments transaction data generated within Nigeria are stored and managed in Nigeria in accordance with data protection laws and regulations applicable in Nigeria.”
It added that “all affected Financial Institutions shall fully comply with this requirement effective January 1, 2027.”
The move is expected to strengthen regulatory oversight, enhance data sovereignty and ensure that sensitive payment information remains within Nigeria’s jurisdiction.
It also aligns with broader efforts by regulators globally to localise critical financial data and reduce reliance on offshore infrastructure.
Beyond data localisation, the CBN ordered banks, payment service providers and other financial institutions with digital payment operations to disclose the ultimate beneficial ownership of significant shareholders.
According to the circular, institutions must maintain accurate and up-to-date records of their ultimate beneficial owners and make such information available to the apex bank upon request.
The regulator said the disclosure requirement must comply with existing anti-money laundering, counter-terrorism financing and counter-proliferation financing regulations.
The directive builds on previous CBN efforts to strengthen beneficial ownership transparency as part of wider measures to combat money laundering and illicit financial flows in the financial system.
The central bank also introduced fresh competition rules aimed at limiting excessive market dominance in the payments industry.
Under the new framework, any financial institution that controls more than 25 per cent of the card-issuing market in a rolling 12-month period will not be allowed to hold more than 15 per cent of the merchant-acquiring market during the same period.
Similarly, operators with more than 25 per cent market share in merchant acquiring activities will be restricted to a maximum of 15 per cent market share in card issuing activities.
Merchant acquiring refers to processing card payments on behalf of merchants, while card issuing involves providing payment cards to customers.
The CBN said all regulated entities would be required to submit monthly market share returns based on prescribed templates and timelines.
It further directed affected institutions to take the necessary measures to achieve full compliance with the market structure requirements by December 31, 2026.
The apex bank said the new measures were designed to “improve transparency through beneficial ownership disclosure, address concentration risk, promote a fair, competitive, and resilient payments ecosystem.”
According to the regulator, the reforms are also intended to “safeguard the integrity of the Nigerian payments system and ensure the localisation of payments transaction data within Nigeria.”
The CBN warned that it would closely monitor compliance and impose sanctions where necessary.
“The CBN shall monitor compliance with the provisions of this Circular and may, where necessary, impose supervisory sanctions in accordance with applicable laws, regulations, and guidelines,” the circular stated.
The latest directive comes amid a rapid expansion of Nigeria’s digital payments industry, with electronic transactions reaching record levels and regulators increasing oversight of banks, fintech firms and other payment operators to address operational, cybersecurity and systemic risks.
Foreign exchange markets are entering a phase where how traders are positioned may matter as much as the economic fundamentals driving those positions, according to a new market analysis from JustMarkets.
JustMarkets
The brokerage’s latest commentary points to a build-up in trades tied to the US dollar and to carry strategies, bets that exploit interest rate differentials between currencies, as a growing source of risk heading into the coming weeks.
The dollar has been supported by elevated US interest rates and pushed-back expectations for rate cuts, conditions that have encouraged more traders to pile into similar carry positions. While the macro case behind these trades remains intact for now, JustMarkets cautions that when positioning becomes this lopsided, even sound trades can become vulnerable to sudden, sharp reversals.
A “crowded trade” isn’t inherently a red flag, the analysis notes, it can simply reflect a widely shared, fundamentally sound view. The danger emerges when too many participants are leaning the same way and conditions shift: traders rush to exit together, stop-loss orders cluster around similar price levels, and liquidity can evaporate just as prices move fastest. The combination, JustMarkets says, often produces a cascade effect that accelerates price moves in the opposite direction.
Notably, the analysis argues that reversals in crowded trades rarely require a major shock. Instead, minor developments, a softer-than-expected economic print, a subtle shift in central bank language, or fresh geopolitical headlines, can be enough to make traders question whether their positions still make sense. Once that doubt spreads, unwinding tends to happen in unison, amplifying both the speed and scale of the move.
Carry trades are singled out as particularly exposed in this environment. They tend to perform well during calmer periods but can unravel quickly once markets shift from “risk-on” to “risk-off,” triggering rapid liquidations and sharp corrections in carry positions.
JustMarkets argues that the current backdrop, marked by elevated geopolitical tension, persistent inflation, and lingering uncertainty over the path of monetary policy, leaves markets more exposed to positioning-driven swings than in previous cycles. Trader sentiment, the analysis suggests, is playing an outsized role alongside the usual response to economic data and headlines.
With crowded conditions raising the odds of fast, disorderly moves, the quality of trade execution becomes more consequential, the analysis notes, citing slippage, wider spreads, and order delays as factors that can compound losses during volatile swings.
On managing risk, JustMarkets’ analysts recommend that traders: Avoid overexposure to the dominant macro narrative of the moment, pay closer attention to positioning and sentiment indicators, maintain disciplined stop-loss orders ahead of potential downturn and pPrepare for higher volatility and faster price action than usual.
Markets become crowded periodically, and when they do, the risk of a sharp, sudden reversal rises with them. For now, JustMarkets’ broader message to traders is one of caution: with positioning levels elevated across USD and carry trades, vigilance on execution and risk management will likely matter more than usual in the weeks ahead.
Association of Corporate Communication and Marketing Professionals in Banks (ACAMB) on the 11th of June kicked off activities, marking its 30th anniversary celebration with a tree-planting exercise on Providence Street, Lekki Phase 1, Lagos.
L-R: President, Association of Corporate Communication and Marketing Professionals in Banks (ACAMB), Jide Sipe; Representative of Wema Bank, Precious Akpan; Vice President 2, Morolake Onifade, Representative of Alpha Morgan, Tolu Onipede and General Secretary, ACAMB, Olugbenga Owotoomo during a tree planting initiative, put together to flag-off the 30th anniversary celebration of ACAMB, held at Providence Street, Lekki Phase 1, Lagos
Held in Lagos recently, the initiative, the initiative was part of the associations efforts aimed at promoting environmental sustainability while commemorating 3 decades of advancing corporate communications and marketing excellence within Nigeria’s banking industry.
The well attended exercise, led by President of ACAMB, Jide Sipe and the Registrar/Chief Executive Officer of the Chartered Institute of Bankers of Nigeria (CIBN), Akin Morakinyo, in the company of Vice President 1, Chinwe Bode Akinwande; Vice President 2, Morolake Onifade; Executive committee Members, both past and present, alongside, Group Heads of marketing and Corporate communications, and Heads of Departments across banks waded through the heavy downpour, planting trees in the rain in a display of commitment that set the tone for the milestone celebration.
A tree was planted, by representatives of banks in the country and named after each bank.
ACAMB President, Jide Sipe, who welcomed members and dignitaries to the exercise, reaffirmed the Association’s commitment to the reputation and growth of the banking industry.
“Thirty years ago, a handful of professionals chose to put the reputation of the banking industry above rivalry. We are standing today on the foundation they laid, and every tree we plant here is a promise to keep building and most importantly deepen credibility by proactively addressing issues which directly improve our collective brand image and customer loyalty,” he said.
“What ACAMB is doing also coincides with our 30th anniversary celebration. One of the best ways to celebrate this milestone is to contribute to the environment by the planting of trees that will on the long run be environmentally and economically impactful to the society at large.
“We are planting trees in honour of banks in the country and each of the trees will be named after them.
Outlining the anniversary programme, Sipe announced a series of activities running through September 2026, including a Golf and Networking Experience on June 27, 2026, at Ikoyi Club, Lagos, with the celebration culminating in a grand Gala Night on September 30, 2026.
“We are marking three decades the way they should be marked, with substance and with joy,” he said.
The Registrar and Chief Executive Officer of the Chartered Institute of Bankers of Nigeria (CIBN), Akin Morakinyo, HCIB, unveiled the Association’s 30th anniversary logo and commended ACAMB for its longstanding collaboration with the Institute.
“This anniversary is dedicated to the glory of God and the service of humanity,” he said. “I charge every member to hold firmly to professionalism and ethics in the discharge of their duties.”
A founding member of the association, Dr Nkechi Ali Balogun, offered a historical reflection on its formation. ACAMB was established in 1996 by representatives of five institutions: IBWA (later Afribank), Union Bank, NEXIM Bank, First Bank, and the Central Bank of Nigeria (CBN).
“The late Mr. Dangogo of the CBN gathered us at Kuramo Lodge with a simple idea, that banks could compete and still respect one another,” she said.
Member of the Association’s Board of Trustees, Ogie Eboigbe, traced the formation to concerns over banks de-marketing one another.
“Banks were winning customers by tearing down their rivals, and it was hurting public confidence in all of us,” he explained.
The tree-planting exercise reflects ACAMB’s commitment to environmental sustainability and stands as a fitting symbol of the Association’s growth and impact over the past three decades.
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