The initiative targets small and medium-sized enterprises (SMEs) with proven growth potential that struggle to obtain commercial loans to expand operations, acquire productive assets and create jobs.

The fund will share credit risk with participating finance partners, enabling lenders to offer eligible businesses larger loans with longer repayment periods.

Cascador’s white paper, The Multiplier Model, highlights the scale of the financing challenge. According to the report, only 22 per cent of businesses in Sub-Saharan Africa have a bank loan or line of credit, compared with the global average of 36 per cent.

Cascador Chief Executive Officer, Trish Thomas, said the initiative was designed to bridge the gap between entrepreneurs’ financing requirements and the capital available to support their growth.

She noted that sharing credit risk with lenders and leveraging relationships established by business ecosystem partners could help Nigerian businesses with proven traction secure appropriate financing.

Sterling Bank Group Executive, Obinna Ukachukwu, said the partnership would combine credit-risk protection with referrals from venture funds and studios familiar with the businesses they support.

He explained that structured assessments and continuous monitoring would strengthen lenders’ confidence in providing larger, longer-term loans to qualified enterprises.

Under the arrangement, SME ecosystem partners will identify and nominate businesses that meet the fund’s debt-readiness requirements. Applicants will undergo eligibility checks, guarantee assessments and portfolio-risk evaluations, supported by artificial intelligence-powered underwriting and due diligence.

Approved borrowers will receive a defined credit backstop to cover qualifying losses, while participating finance partners will retain responsibility for independently evaluating applications, approving and disbursing loans, servicing accounts, monitoring performance and collecting repayments.

Initially, eligible SMEs can apply for local-currency loans equivalent to $250,000, with repayment schedules tailored to their cash flows and subject to lender approval. Once fully funded, the initiative aims to unlock individual loans of up to $1 million.

The structure will bring together SME ecosystem partners, lenders and backstop capital providers, including philanthropic funders, impact investors and development-finance institutions. These participants will help build the guarantee reserve and mobilise additional lending.

Future Africa Founding Partner, Iyinoluwa Aboyeji, welcomed the initiative, saying African businesses need a combination of equity, debt and long-term securities to finance expansion and acquire productive assets.

He said the fund could enable more Nigerian businesses to obtain the financing required to expand and generate employment.

The initiative will operate through Riverwell Platform Holding Limited and Riverwell Platform Services Nigeria, with reserve capital held separately.

The Nigerian operating company will coordinate partners, support business readiness, conduct assessments, collect data, monitor portfolios and prepare reports. The separate reserve entity will manage the capital backing the credit guarantee.

Ukachukwu will also serve as a director on the Riverwell platform, contributing banking expertise to financing structures, credit-risk oversight and portfolio monitoring.

The fund builds on a Catalytic Fund model piloted over the past two years by Cascador, which acted as nominator and guarantor, and Sterling Bank, which served as lender. The new facility will be independently managed and structured to accommodate multiple ecosystem partners.

Since 2019, Cascador has supported 80 ventures that have collectively raised more than $150 million in capital. In 2025, businesses in its alumni network served more than 1.7 million customers and directly employed nearly 4,000 people.

Source: MSME Africa Online