By Merit Ibe
In the bid to create growth across key sectors of the economy, the Development Bank of Nigeria (DBN) said it has disbursed more than N230 billion to support small businesses in the trades and commercial sectors of the country over the past 5 years leading up to December 2022.
Managing Director and CEO of the bank, Dr Tony Okpanachi, made the disclosure while presenting the progress report and achievements of DBN over the past five years of its operation as a wholesale development finance institution. He noted that the bank has provided financing support to its participating financial institutions to the tune of N631 billion as of December 2022.
Okpanachi said the story of the bank thus far has been an extraordinary journey of empowering MSMEs and propelling sustainable development across all sectors of the Nigerian economy.
“Our experience has been nothing short of remarkable, filled with much learning and of course, resilience, amidst the diverse headwinds that have sought to inhibit the bank’s progress in our nascent space of wholesale development finance.
“Over 313,000 MSMEs have benefited from this support, leading to the creation of more than 900,000 jobs. These numbers signify hope and prosperity for countless individuals and families across the nation.”
He further explained that the bank also extended its financing support to various other sectors, recognising their importance in the overall development and prosperity of the Nigerian economy.
“More than N230 billion has been channelled to support small businesses in the Trade and Commerce sector over the past 5 years leading up to December 2022.”
He said for the manufacturing sector which is another important aspect of the Nigerian economy, the bank has supported MSME players in the sector with more than N69 billion in financing. “For the agricultural sector, we have provided N27 billion to Agro-MSMEs, while in the “Hospitality and Tourism Sector, DBN has provided N13 billion in financing support to MSMEs operating in the hospitality and tourism sector.
“In the Education Sector, DBN has allocated N12 billion in financing to support quality education in Nigeria, with the Health Sector, having N11.5 billion in financing support.
For the nation’s fast rising Technology Sector, we have allocated N11 billion to the technology sector, supporting businesses involved in technology and innovation initiatives. Furthermore, DBN, over the years has taken a customer-centric approach to product development, helping the bank to meet the diverse needs of different segments and regions within the MSME ecosystem.
From our discovery, the challenges of different MSME actors differ, and so are their needs. To address these gaps, DBN has maintained its strong commitment to innovative product development, developing specialized offerings such as the Long-Term Finance (LTF) product to support the PFIs in providing longer-tenor financing to the end-borrowers.
“The Bank also developed the Green Finance product to support businesses facilitating green transitions through renewable energy, sustainable agriculture, sustainable waste management, and so on. The Non-Interest Banking (NIB) product was developed to support small businesses, particularly those that are financially excluded and located in economically challenged regions. . The Gender Finance Framework developed by the Bank is another attempt to increase the share of women entrepreneurs benefiting from our financing. Over the years, these specialized solutions have enabled us to catalyse more impact on the last-mile enterprises, improve access to finance, and support the development of MSMEs across different segments and locations.
“DBN’s Commitment to Sustainability and Climate Action
As a responsible and sustainability-driven institution, we also recognize that there is a need to support the fight against climate change. Climate change has far-reaching implications. Key sectors such as agriculture, energy, water resources, and infrastructure face significant disruptions. Extreme weather events and rising sea levels damage critical infrastructure, disrupt supply chains, and increase the costs of disaster response and recovery. The economic stability and sustainable development of Nigeria are also heavily dependent on addressing climate change. This is why DBN has actively embraced initiatives to promote environmentally-friendly practices and increase its support for businesses in the Green economy. We have actively been participating in global climate change forums, including COP26, COP27, and Finance in Common Summit where we demonstrate our commitment to addressing climate change and financing sustainable development. In addition, we have established Green Clubs in some secondary schools in Nigeria, to instill environmental consciousness in the younger generation. DBN is also undergoing the accreditation process to be the first Direct Access Entity (DAE) to the Green Climate Fund. Through offerings like the Interest Drawback Program, we also incentivize lending to green and environmentally-friendly businesses, contributing to a greener and more sustainable future.
“Technical Assistance and Capacity Building
In addition, we recognize that strong, structured, and sound financial institutions are pivotal to the success of Nigerian MSMEs. To this end, we have diligently worked to strengthen the capacity of our PFIs to deliver on the mandate of alleviating financing constraints among Nigerian MSMEs. Through a technical assistance program implemented by the prestigious Frankfurt School of Finance and Management, we have empowered 20 PFIs by augmenting their processes and deepening their ecosystem knowledge of Nigerian MSMEs. This collaborative effort has therefore enhanced the PFIs’ ability to adequately meet the needs of MSMEs, creating a thriving ecosystem for sustainable growth.
Also worthy of note is that the Development Bank of Nigeria has forged invaluable partnerships, including collaboration with Google Nigeria, the Entrepreneurship Development Centre (EDC) of the Lagos Business School, and other esteemed organizations to deliver capacity-building programs to Nigerian MSMEs. In 2022, we took a significant step in empowering Nigerian entrepreneurs by developing a state-of-the-art Learning Management System (LMS) designed to facilitate their upskilling and continuous learning journey These efforts have culminated in the training of more than 4,000 MSMEs as of December 2022, equipping them with the necessary knowledge and skills to overcome financing challenges and drive their growth aspirations.
“Customer Satisfaction, Reputation, and Certifications
Our commitment to exceptional customer satisfaction remains unwavering. By the end of the 2022 financial year, our customer satisfaction survey revealed an outstanding rating of 90%, a testament to our dedication to meeting and surpassing the expectations of our valued clients. Furthermore, our exceptional Net Promoter Score (NPS) of 90% far exceeds the global average of 30% in B2B markets. This remarkable achievement highlights the enthusiastic support of our PFIs, who willingly advocate for DBN within their networks, based on their highly positive experiences with the Bank.. Their trust in our professionalism, customer-centric approach, and the excellence of our products and services is indeed, humbling.
“DBN’s drive for excellence has also positioned us as a role model for other Development Finance Institutions (DFIs) and governments across Africa. Today, we share our knowledge and experiences to empower them to drive impactful development in their respective institutions and throughout the continent. This serves as a testament to the Bank’s unwavering dedication to driving positive change throughout the nation, reinforcing its pivotal position as a leading force in developmental finance across the continent. This recognition serves as both validation and inspiration for us, affirming that our ongoing efforts are acknowledged globally. It reinforces our belief in the need for greater dedication and calls us to fulfill our duty with even greater commitment.We have also achieved significant milestones in our credit ratings and certifications. Today, DBN proudly holds credit ratings of AAA by Augusto & Co. and GCR Ratings, which are both testaments to our financial strength and stability. Additionally, we obtained re-certifications in 2022 for different ISO standards. The ISO 22301 for Business Continuity Management Systems, ISO 27001 for Information Security Management Systems, and ISO 20000 for IT Service Management. All these are to showcase our unwavering commitment to operational excellence, security, and the continuity of our services. Furthermore, we have attained the highest rating level of the Sustainability Standards & Certification Initiative (SSCI) among DFIs in Nigeria, underscoring our dedication to sustainable development and responsible financing.
“Future Outlook and Conclusion
As we celebrate these achievements, we remain resolute in our commitment to even greater heights. While acknowledging the hurdles that lie ahead, we embrace them as gateways to transformation, innovation, and a greater sphere of influence. We will continue to leverage our strengths, build viable partnerships, and explore new opportunities for impact, ensuring that the Development Bank of Nigeria remains a catalyst for sustainable development.