FirstBank, Industry Leaders Push Digital and Risk-Sharing Models for SME Growth
West Africa’s trade ambitions will rise or fall not only on ports, policy and payments, but on whether its small businesses can get financed. That was the underlying message from industry leaders at the 2026 Global Trade Review West Africa conference in Lagos, where financial experts argued that digitisation, stronger collaboration and smarter risk allocation are now essential to unlocking supply chain finance for small and medium-sized enterprises.
The discussion, held under the theme “Scaling supply chain finance: Boosting domestic value chains, looking across borders,” placed SMEs at the centre of the region’s financing challenge. These businesses are often celebrated as the backbone of growth, employment and value creation. Yet in practice, many remain too informal, under-documented and structurally weak to access conventional bank credit on sustainable terms.
That contradiction has become one of the biggest obstacles to domestic industrial expansion.
Why SME Finance Still Stalls
At the heart of the problem is risk.
Banks and other financial institutions may acknowledge the importance of SMEs to domestic supply chains, but they are also custodians of depositor funds. That means they cannot afford to lend sentimentally. Many smaller businesses still lack the financial records, governance discipline and transaction visibility that traditional credit processes demand.
Oluseye Thomas, Head of Export Desk at First Bank of Nigeria Ltd., argued that supply chain finance can bridge part of that gap—but only if the underlying model changes. In his view, the solution lies not in exposing banks directly to the weakest ends of the value chain, but in restructuring risk around stronger corporate anchors.
The principle is straightforward: rather than lend to SMEs in isolation, financiers can lend against the strength of the larger companies they supply. In that model, risk shifts from the smaller enterprise to the better-capitalised corporate at the centre of the chain.
This is a more realistic pathway to inclusion than romanticising SMEs while leaving their structural weaknesses unaddressed.
Digitisation as a Financing Tool
Digitisation was identified as another crucial lever.
Thomas noted that digital systems can improve transparency, reduce fraud, streamline documentation and strengthen logistics coordination across value chains. That matters because financing does not depend only on willingness to lend. It also depends on the visibility of transactions, the traceability of goods and the credibility of commercial relationships.
In practical terms, digitised invoice discounting, vendor financing and contract financing can make supply chain finance more efficient and more bankable. By reducing opacity, digital platforms help bring smaller businesses into a financing environment that institutions can assess and trust.
But the panelists were careful not to treat technology as magic. Digitising a broken process, they warned, does not fix it. It simply speeds up inefficiency. Real progress requires proper process design, integration across systems and strong cybersecurity architecture.
Collaboration Is No Longer Optional
The experts also returned repeatedly to a central truth: no single institution can solve the financing puzzle alone.
Banks, corporates, regulators, development finance institutions, insurers and technology providers all have a role to play in building a workable ecosystem. Victory Olumuyiwa, Global Head of Treasury and Investor Relations at Sun King, stressed the need for deeper engagement with regulators to create enabling frameworks for innovation. That is an important point. Financial innovation often fails not because of lack of ideas, but because regulatory systems are too slow, fragmented or uncertain to support scale.
Others on the panel pointed to securitisation, guarantees and risk-sharing arrangements as essential instruments for unlocking capital. Development finance institutions, in particular, can help by taking first-loss positions that reduce risk for commercial lenders. Insurance firms also have an important place in underwriting specific exposures that would otherwise deter financing.
In other words, SME finance is not merely a banking issue. It is a market-architecture issue.
The Cross-Border Opportunity
The conversation did not stop at domestic value chains. Panelists also looked outward, noting that trade finance in West Africa cannot truly scale without better cross-border systems.
Payment inefficiencies, inconsistent processes and uneven standards continue to slow commerce across the region. If the African Continental Free Trade Area is to become a real commercial platform rather than a policy aspiration, financial infrastructure must evolve alongside it.
That means faster payments, harmonised processes and stronger credit-support mechanisms that allow businesses to trade with greater confidence across borders.
For West African economies, this is about more than access to credit. It is about creating the conditions in which domestic producers can plug into regional supply chains without being choked by working-capital constraints.
A More Serious Approach to SME Growth
Perhaps the most useful insight from the session was the implicit rejection of superficial SME rhetoric.
Too often, discussions about small business financing are framed in moral rather than structural terms. SMEs are described as deserving, energetic and vital—which they are. But financing them at scale requires more than goodwill. It requires systems that make their participation less risky, more visible and more commercially credible.
That is why digitisation, collaboration and risk restructuring emerged as the panel’s three central pillars. Together, they point toward a more serious approach—one that recognises that inclusive finance is not about lowering standards, but about redesigning the system so more viable businesses can meet them.
BRANDECONOMY Insight
West Africa’s SME financing gap is not simply a capital shortage. It is a trust shortage wrapped in a systems problem.
The most important shift in the panel’s discussion was the move away from direct-risk lending to smaller, fragile enterprises and toward anchor-led financing models. That is where real scale may come from. When the strength of large corporates is used to support smaller suppliers, the financing chain becomes more credible, more investable and less vulnerable to default shock.
Digitisation is equally important, but only when tied to operational discipline. The future of supply chain finance will belong to systems that can prove transactions, verify obligations, reduce fraud and shorten cash-conversion cycles.
There is also a larger regional lesson. AfCFTA will not deliver its promise if SMEs remain trapped outside the financing system. For trade integration to work, the financial architecture supporting domestic and cross-border commerce must become deeper, smarter and more collaborative.
In the end, West Africa does not merely need more money for SMEs. It needs a better structure through which capital can safely reach them.
