LAGOS, Nigeria — 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 is supported through the British High Commission in Nigeria and is being set up by Rising Tide Africa, a pan-African network of women angel investors. It aims to mobilise $2.7 million, about ₦3.75 billion, from Nigerian investors. The funding is expected to support 15 small and growing businesses across the country by helping them secure capital to expand.
The initiative targets a financing gap that the International Finance Corporation estimates at about ₦13 trillion for Nigerian small businesses, with 19 in every 20 unable to access formal finance. Women own around 40% of the country’s small businesses, yet they are rejected for credit at more than three times the rate of men, according to the statement. Many lack collateral such as land, which banks traditionally require, even when their businesses are profitable and able to repay loans.
Paul Healey, Head of Green Growth and Private Sector Development at the British High Commission, said the initiative is part of the United Kingdom Government’s wider effort to expand access to finance for promising small and growing businesses. He said the partnership between the government, FSD Africa and Rising Tide Africa would help connect women entrepreneurs with investors.
Juliet Munro, Director for Early-Stage Finance at FSD Africa, said the network could help mobilise domestic capital and channel it into businesses that need growth financing. She argued that Nigeria has capital, and that the women angel investors in Rising Tide Africa have already backed women-led businesses with their own money. The network is designed to give that capital a formal structure and instrument.
The platform is meant to address the currency risk of dollar-denominated financing for businesses that earn their revenue in naira. When the naira weakens, the cost of servicing dollar debt rises. The network will therefore lend in naira.
Yemi Keri, General Partner at the RiTA Investment Network, said the platform aims to raise $10 million in local-currency funding for women-led enterprises. The network will rely on professional credit assessments, an investment committee, an advisory board, and monitoring and reporting systems to give investors more confidence.
FSD Africa will cover the cost of setting up the network during its first three years, including its team, legal structure, governance and operating systems. After that, the network is expected to become self-sustaining through fees. Rising Tide Africa’s members have backed 39 companies to date and have secured about $1.5 million in soft commitments from within their network.
