By: Goodluck E. Adubazi, Abuja.
A recent report has revealed that over 120 million youths enter the African job market every year. Yet, only 3 million jobs are created, leaving a staggering gap of 117 million unemployed youths annually, according to Flora Mutahi, Managing Director and CEO of Melvin Marsh International, Kenya.
Mutahi made this revelation in Abuja on Thursday, September 25, 2025, while delivering a keynote address at the Development Bank of Nigeria (DBN) Annual Lecture Series, held at the Congress Hall of the Transcorp Hilton. The theme was: “Positioning Nigerian MSMEs for Growth in a Dynamic Policy Environment.”
“If we don’t act now, we are creating a future where the majority of our youth become either frustrated or forgotten. The solution lies in scaling up our MSMEs and empowering them with funding, knowledge, and exposure,” Mutahi said.
MSMEs Hold the Key — But Face Structural Barriers
Mutahi emphasized that Micro, Small, and Medium Enterprises (MSMEs) contribute 30% of Nigeria’s GDP, compared to 50–60% in parts of Asia.
“The disparity is massive. Africa holds 22% of global MSMEs, yet their impact is stifled by fragmented markets, poor logistics, and a lack of access to finance,” she added.
Citing a report from the African Development Bank, she stressed that unless structural changes are made, the youth unemployment crisis will worsen.
“Collateral Should Not Be a Barrier”: Stakeholders Demand Reform in MSME Financing
On the sidelines of the DBN lecture, Dr. Kabiru Dodo, an entrepreneur and participant, criticized Nigerian banks for their over-reliance on collateral-based lending, calling instead for a developmental, inclusive approach.
“In the U.S., banks don’t just ask for collateral — they monitor, support, and even fund struggling businesses again. Why can’t Nigerian banks do the same?” Dr. Dodo asked during an interview with Standard Times Nigeria.
“No Collateral? Visit the Farm”
Dr. Dodo argued that many Nigerian farmers and entrepreneurs, especially in rural areas, possess land and productive capacity but lack formal documentation.
“There are onion and potato farmers with hectares of land who have no bank accounts. Banks should visit these farms, assess the assets, and fund them directly — no collateral needed. Just monitor their progress,” he said.
Citing his personal business idea, Dr. Dodo proposed launching a packaged food company catering to busy urban households.
“We could cook traditional meals, package them hygienically, and deliver them. But when we go to banks, they demand collateral instead of funding and monitoring our idea. By the time the loan comes, someone may have stolen the concept,” he lamented.
Panelists Echo the Call: “Shift From Collateral-Based Lending to Development-Oriented Models”
During panel sessions and fireside chats, industry experts and stakeholders aligned with Dodo’s stance. They called for:
A shift toward monitoring-based lending models
Enhanced digital identity systems to track business activities
Legislative action to create a national data infrastructure
Increased capacity-building programs for MSMEs
“Until we domesticate strong digital systems like global ID networks, we’ll continue excluding the real players — those in the grassroots — from formal finance,” one panelist noted.
As Africa’s youth population continues to surge, experts agree: empowering MSMEs is not just an economic strategy — it is a survival tactic.
“There’s no free lunch,” Flora Mutahi concluded. “We must buckle up and position our MSMEs for local, regional, and global relevance.”