Independent enterprise designed to help Nigerian SMEs access larger, longer-term loans
14 October, Lagos, Nigeria: Cascador and Sterling Bank have announced a $200 million SME Credit Backstop Fund, an independent platform designed to expand access to growth capital for debt-ready Nigerian SMEs. The fund will provide a defined credit-risk backstop to participating finance partners, with the model supporting up to $1 billion in outstanding credit capacity.
The initiative follows the publication of Cascador’s white paper, The Multiplier Model, which examines the constraints limiting African businesses’ ability to scale and the importance of matching capital to each business’s needs and maturity. Across Sub-Saharan Africa, businesses finance a greater share of investment through equity than the global norm, reflecting the limited availability of debt as a suitable source of growth capital. Only 22% of businesses in the region hold a bank loan or line of credit, compared with a global average of 36%. The SME Credit Backstop Fund responds to this gap by creating a structured route to larger, longer-term loans for businesses that are ready to borrow but face barriers to accessing debt.
“Nigeria is rich in entrepreneurial talent and innovation and yet their potential is constrained by lack of access to capital that matches where they are and what they are trying to achieve,” said Trish Thomas, CEO of Cascador. “The SME Credit Backstop Fund aims to transform potential into a reality by bringing the experience and capital of the ecosystem to create a practical route to debt for Nigerian businesses with proven traction. By sharing risk with lenders, and translating community trust into a bankable signal to lend, the fund can help more businesses access what they need to scale and create jobs.”
Cascador brings experience identifying, supporting, and investing in businesses with the potential to scale, while Sterling Bank contributes lending infrastructure and credit-market expertise. The fund will also bring together SME ecosystem partners, finance partners, and backstop capital providers, such as philanthropic funders, impact investors, and development-finance institutions within a single risk-sharing model, helping to support the guarantee reserve and mobilise additional SME lending.
“At Sterling, the strength of this partnership lies in how it addresses lending risk across the entire financing journey,” said Obinna Ukachukwu, Group Executive, Sterling Bank. “Alongside the additional protection of the credit backstop, the initiative brings together businesses recommended by participating venture funds and studios that know these enterprises and have supported their development. This combines a stronger borrower pipeline with structured assessment and ongoing monitoring, giving us greater confidence to provide larger, longer-term loans. As a lending partner, we see the potential for this arrangement to bolster SME lending, helping proven businesses access the capital they need to scale.”
Sterling Bank is an innovation-led financial institution guided by a belief in impact capitalism, deploying capital to deliver commercial returns while improving lives and expanding opportunity. Its focus on the HEART sectors – Health, Education, Agriculture, Renewable Energy and Transportation – reflects its commitment to helping solve Nigeria’s most critical problems and enabling Nigerian businesses to thrive. The partnership advances Sterling’s belief that Nigeria’s growth capital should be orchestrated locally, informed by the country’s realities, and designed to solve its problems.
For SMEs, the model is intended to provide a route to larger, longer-tenor growth capital with reduced collateral and guarantee burden. For finance partners, it offers access to a pipeline of debt-ready businesses alongside structured risk sharing, while for ecosystem partners, it creates a financing route for proven businesses that have progressed beyond early-stage support and are ready for commercial debt.
The model works across four parts of the financing chain:
- SME ecosystem partners identify and nominate businesses that meet the fund’s debt-readiness standards.
- The fund applies its own eligibility, guarantee and portfolio-risk standards utilizing AI-powered underwriting and due diligence. For approved borrowers, the fund provides a defined backstop against losses.
- Finance partners independently assess borrowers, approve and disburse loans, and retain responsibility for servicing, monitoring and collections.
- SMEs can initially access local currency loans equivalent to $250,000, with longer-term financing aligned to business cash flows and subject to lender approval. The fund aims to unlock loan sizes of up to $1,000,000 once fully funded.
Iyinoluwa Aboyeji, Founding Partner of Future Africa, said, “Over the last 12 years, Future Africa has provided early-stage funding to over 100 companies, including a third of the continent’s unicorns. Those early bets have taught us one thing: the future cannot be sustainably built on one layer of the capital stack. Equity must work with debt and long-term securities to provide builders with the capital they need to build the future. This is why we are so excited about the SME Credit Backstop Fund, and how it will enable more Nigerian businesses to access financing for the productive assets they need to create jobs.”
The fund will operate through Riverwell Platform Holding Limited, a UK-owned technology-enabled SME infrastructure platform and Riverwell Platform Services Nigeria, with reserve capital held separately. The Nigerian operating company will oversee partner coordination, business-readiness, assessment, data collection, portfolio monitoring and reporting, while the reserve company holds and manages the capital supporting the backstop.
Ukachukwu will also serve as a director on the Riverwell platform, bringing Sterling’s banking expertise to guide financing structures, credit-risk oversight and portfolio monitoring. Modeled upon the Catalytic Fund structure piloted over the past 2 years by Cascador (as nominator and guarantor) and Sterling (as lender), the new fund will be independently managed to ensure sustainability and discipline while allowing participation from a range of ecosystem partners.
The SME Credit Backstop Fund builds on Cascador’s work as one of Africa’s most active investors, and as a platform that unlocks the potential of Nigeria’s most transformative entrepreneurs. Since 2019, Cascador has supported 80 ventures that have collectively raised over $150 million in capital. In 2025 alone, Cascador’s alumni delivered essential products and services to more than 1.7 million customers and directly employed almost 4,000 people.
The Multiplier Model whitepaper is available to download here.
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About Cascador
Cascador is a Nigeria-focused platform for growth-stage founders building businesses that make an impact. Through Cascador ScaleUp, its flagship program, Cascador works with an elite cohort of entrepreneurs to strengthen their leadership and sharpen their strategy, preparing them to scale successfully. ScaleUp alumni gain exclusive access to the Catalytic Fund, which deploys up to $5M USD in capital annually through a blend of debt and equity investments. Since 2019, Cascador has supported 80 companies that have collectively raised over $150 million. Today, alumni are driving innovation, creating jobs, raising investment capital, winning awards, and changing the face of the African economy. Learn more at www.cascador.org
About Sterling Bank
Sterling Bank Limited is a full-service national commercial bank in Nigeria and a member of Sterling Financial Holdings Group. With a heritage of more than 60 years, the bank has evolved from Nigeria’s pre-eminent investment banking institution to a trusted provider of retail, commercial, and corporate banking services.
Sterling is a forward-thinking financial institution committed to transforming lives through innovative solutions, exceptional service, unwavering integrity, and a steadfast focus on its HEART strategy, which centers on Health, Education, Agriculture, Renewable Energy, and Transportation. As pioneers in digital banking and financial inclusion, Sterling continues to lead by example, showing how purpose-driven leadership can deliver transformative outcomes for individuals, businesses, and society at large.
Guided by a culture of innovation and a passion for excellence, Sterling Bank remains dedicated to redefining the banking experience for millions of customers across Nigeria.
