Nigeria’s biggest banks have finished raising the fresh capital the Central Bank ordered them to find. The bigger question for small business owners is whether that new financial muscle actually reaches them.
Five banking stocks tell part of the story. FCMB Group, United Bank for Africa, Fidelity Bank, Sterling Financial and Access Holdings have all underperformed the wider banking index in 2026, even after completing capital raises worth hundreds of billions of naira. The NGX Banking Index gained about 65.86 percent this year as of August 4, while FCMB actually fell 6.64 percent over the same period.
For investors, that gap may point to undervalued shares. For entrepreneurs, it raises a more practical question. Stronger balance sheets do not automatically translate into easier or cheaper credit.
The Central Bank of Nigeria ordered banks to raise fresh capital in 2024 after inflation, naira depreciation and other economic pressures weakened the real value of existing capital.
International commercial banks needed at least ₦500 billion in paid-up capital and share premium. National banks needed ₦200 billion, while regional commercial banks required ₦50 billion. The deadline expired on March 31, 2026.
The CBN did not design the programme simply to make bank balance sheets look stronger.
It said larger capital bases should improve banks’ ability to absorb losses and give them greater capacity to extend credit to businesses and other productive parts of the economy.
The banks therefore have more capital behind them. That should improve their capacity to lend.
But capacity is not the same thing as willingness to lend.
Could More Capital Lead to More SME Loans?
There are signs that lending could expand.
Cordros Capital projected earlier this year that banking-sector loan growth could reach 13.4 percent in 2026, compared with 9.8 percent in 2025. The investment firm expects retail customers, SMEs and mid-sized companies to contribute to stronger credit demand.
Some banks are already increasing their SME exposure.
Fidelity Bank reported ₦267.65 billion in MSME financing in 2025, up from ₦164.31 billion a year earlier. That represents an increase of almost 63 percent. Its MSME balances also climbed from ₦400.13 billion to ₦767.73 billion.
UBA also maintains working-capital and asset-finance products of up to ₦50 million for qualifying SMEs. FCMB offers working-capital facilities, invoice financing and asset financing, with its SME asset product providing funding of up to ₦500 million.
Access Bank currently advertises SME asset financing of up to ₦100 million and collateral-free instant business loans of up to ₦10 million. Sterling also offers working-capital, distributorship, contract and asset-finance facilities targeted at smaller businesses.
So the infrastructure for increased SME lending already exists.
The harder problem is price.
Why Stronger Banks May Not Give Cheaper Loans
A bank can have enough capital to lend and still charge interest rates that many small businesses cannot afford.
The CBN retained its Monetary Policy Rate at 26.5 percent in July. It also kept the Cash Reserve Requirement for commercial banks at 45 percent. Those policies maintain tight monetary conditions while the central bank continues to fight inflation.
Commercial loan pricing reflects more than the MPR. Banks also consider the borrower’s risk, repayment history, cash flow, collateral, operating costs and the length of the loan.
The difference becomes clear when existing SME products are compared.
UBA advertises a micro-business loan at 0.75 percent monthly, equivalent to 9 percent annually, while its green-financing product carries a published interest rate of 33 to 35 percent. FCMB lists a school-support facility at 29 percent annually. Access Bank has a youth business loan at 17 percent annually.
That wide range shows why recapitalisation alone cannot guarantee cheap credit.
Special intervention programmes may offer lower rates, while normal commercial lending can remain expensive.
What This Means for SMEs
For SME owners, Nigeria’s stronger banking sector creates an opportunity, but not an automatic loan approval.
Businesses seeking credit should make themselves easier for banks to assess. That means maintaining a dedicated business account, recording sales, filing required returns, keeping invoices and building a visible transaction history.
Entrepreneurs should also compare products rather than accepting the first loan offered. A business may qualify for a commercial facility, intervention fund or sector-specific programme at very different rates.
Businesses in manufacturing, agriculture, education, healthcare, retail and renewable energy should pay particular attention. Several banks already offer specialised financing for equipment, working capital, schools, solar installations and other productive assets.
More capital does not remove credit risk from the equation. Banks still need evidence that a borrower can service a loan.
Sterling requires bank statements for some SME facilities, and larger applications can call for audited financials, registration documents and cash flow projections. FCMB leans on account turnover and banking history for parts of its SME book, while Access Bank applications remain subject to standard credit screening.
Businesses that mix personal and company finances, keep weak records or transact mostly outside formal bank accounts could still struggle to qualify, regardless of how much fresh capital sits on a bank’s balance sheet.
Expert View
Analysts at Cordros Capital expect credit growth to accelerate through 2026 as banks put their expanded capital base to work, projecting sector-wide loan growth of 13.4 percent for the year. That view supports the CBN’s underlying argument that stronger banks can finance more of the real economy. It does not address pricing, which remains the more immediate obstacle for most SME borrowers.
