Sterling Bank, Cascador Launch $200m SME Credit Fund

Sterling Bank and Cascador have launched a $200m Small and Medium-sized Enterprise (SME) Credit Backstop Fund designed to improve access to growth capital for Nigerian businesses and support up to $1bn in outstanding loans.

According to a report by newsmen, the initiative was announced in Lagos on Wednesday. It will use a risk-sharing model to encourage financial institutions to provide larger, longer-term loans to businesses with established operations and proven commercial performance.

Sterling Bank Fund Targets SME Financing Gap: The $200m represents the size of the credit backstop fund, while the $1bn figure is the lending capacity the model is designed to support. The initiative is not a direct lending scheme; instead, it will provide participating finance partners with additional protection against potential credit losses.

The fund aims to help businesses overcome financing challenges that have limited expansion, investment in productive assets and job creation.

According to Cascador’s white paper, The Multiplier Model, only 22 per cent of businesses in Sub-Saharan Africa have bank loans or lines of credit, compared with the global average of 36 per cent.

The initiative seeks to create a pathway from early-stage investment and business support to commercial borrowing, enabling established enterprises to access suitable funding as they grow.

Sterling Bank, Cascador Explain Partnership

Cascador Chief Executive Officer, Trish Thomas, said Nigeria had significant entrepreneurial talent but that access to appropriate financing remained a major constraint.

“Nigeria is rich in entrepreneurial talent and innovation, and yet their potential is constrained by lack of access to capital that matches where they are and what they are trying to achieve,” Thomas said in a statement.

She described the fund as a practical means of connecting established businesses with the capital required to expand.

“The SME Credit Backstop Fund aims to transform potential into a reality by bringing the experience and capital of the ecosystem to create a practical route to debt for Nigerian businesses with proven traction,” she noted.

“By sharing risk with lenders and translating community trust into a bankable signal to lend, the fund can help more businesses access what they need to scale and create jobs.”

Sterling Bank Fund to Support Business Growth: Cascador will contribute its experience in identifying, supporting and investing in businesses with growth potential, while Sterling Bank will provide lending infrastructure and credit-market expertise.

The initiative will also involve SME ecosystem partners, financial institutions, philanthropic funders, impact investors and development finance institutions.

Their participation is expected to strengthen the risk-sharing framework and mobilise additional lending.

Sterling Bank Group Executive, Obinna Ukachukwu, said the partnership would combine credit protection with a pipeline of businesses supported by venture funds and studios.

“At Sterling, the strength of this partnership lies in how it addresses lending risk across the entire financing journey,” Ukachukwu noted.

He added that participating businesses would benefit from structured assessment and continued monitoring.

“This combines a stronger borrower pipeline with structured assessment and ongoing monitoring, giving us greater confidence to provide larger, longer-term loans. As a lending partner, we see the potential for this arrangement to bolster SME lending, helping proven businesses access the capital they need to scale.”