Bank of Industry, Development Finance and SME Performance in Nigeria

Abstract

Access to finance has been a recurring challenge for Small and Medium Enterprises (SMEs) in the SubSaharan Economies of Africa, and this is without exception of Nigeria, the most populous black nation and regarded as the one of the largest economies in Africa. Development finance is therefore critical to the growth of SMEs as they drive employment and GDP most Economies. This paper examines the role of the Bank of Industry (BOI) in providing development finance to SMEs and its impact on their performance in Nigeria between 2022 and 2026. The Bank of Industry (BOI) can be said to have been in existence since before independence as it started as Investment Company of Nigeria (ICON) in 1959, when ICON was incorporated then later established as NIDB – Nigeria Industrial Development Bank in 1964. In 2001, BOI emerged from the merger of NIDB, NBCI (Nigeria Bank for Commerce and Industry) and Nerfund (Nigerian Economic Reconstruction Fund).The paper looked at several Development Finance Theories which served as the Theoretical Framework. Secondary data from BOI annual reports, CBN publications, and peer-reviewed journals were analysed and used. Several BOI interventions and Products where discussed such as GLOW, RAPID, and iDICE which have all improved access to affordable credit, with interest rates between 5% and 10%, compared to the 26.7% Monetary Policy Rate. The paper concludes that the role of BOI to improved SME performance and industrialisation of the Nigerian Economy can not be over emphasized