Sterling Bank Plc has signed a $30 million credit facility with Proparco, the private-sector financing arm of the French Development Agency Group, to expand renewable energy financing and support small and medium-sized enterprises (SMEs) operating across Nigeria’s agricultural value chain.
The financing agreement is expected to improve access to clean and reliable electricity, strengthen agricultural businesses and create additional economic opportunities for households and enterprises across the country.
The agreement was signed at Sterling Bank’s head office in Lagos by the bank’s Managing Director and Chief Executive Officer, Abubakar Suleiman, and the Chief Executive Officer of the French Development Agency, Christophe Lecourtier.
The facility represents the first step towards a long-term partnership between both institutions and forms part of Sterling Bank’s strategy to direct financing towards sectors considered important for economic development.
Under the arrangement, 80 per cent of the total financing, representing $24 million, will be allocated to renewable energy projects, while the remaining $6 million will support SMEs operating across agricultural value chains.
The agreement comes as Nigeria continues to face electricity supply challenges and financing difficulties affecting businesses, particularly small enterprises and agricultural producers.
$24 million allocated to renewable energy
A major component of the financing will focus on expanding access to decentralised renewable energy solutions, particularly off-grid solar power systems.
These solutions are expected to provide households and businesses with alternative sources of electricity, reducing their dependence on the national grid and fossil-fuel-powered generators.
Nigeria’s electricity challenges have continued to affect business operations, increase production costs and limit the ability of small enterprises to expand.
Many businesses depend on generators to maintain daily operations, resulting in additional expenses associated with fuel purchases, maintenance and equipment.
The financing arrangement is therefore expected to support projects that can provide more reliable electricity to businesses and communities.
Off-grid solar solutions are particularly relevant to areas where access to the national electricity network remains limited or unreliable.
For small businesses, access to dependable electricity can improve productivity, reduce operating expenses over time and create opportunities to expand production.
The renewable energy investment is also expected to contribute to Nigeria’s broader efforts to reduce carbon emissions and encourage the adoption of cleaner energy technologies.
$6 million to support agricultural SMEs
The remaining $6 million from the facility will be directed towards small and medium-sized enterprises operating within Nigeria’s agricultural value chain.
Agriculture remains an important contributor to Nigeria’s economy, providing employment and supporting millions of households.
However, many agricultural businesses continue to face challenges accessing affordable financing for production, processing, storage and distribution.
Limited access to credit can prevent farmers and agricultural entrepreneurs from purchasing modern equipment, expanding operations and improving the quality of their products.
The new facility is expected to address some of these financing constraints by supporting businesses operating across different stages of agricultural production and distribution.
Improved access to finance could help agricultural SMEs strengthen their operations, increase productivity and contribute to food security.
It could also support the development of stronger local supply chains by enabling businesses to invest in the infrastructure and equipment required to move agricultural products from farms to consumers.
Sterling Bank highlights financing challenges
Speaking on the agreement, Sterling Bank’s Managing Director and Chief Executive Officer, Abubakar Suleiman, said Nigeria’s electricity challenge increasingly required financing for decentralised energy solutions rather than relying exclusively on expanding the national grid.
He explained that many households and businesses already spend significant amounts on generator-powered electricity but lack the capital required to transition to cleaner alternatives.
According to him, the facility would help address this financing gap by supporting renewable energy investments.
Suleiman also highlighted the importance of improving access to credit for agricultural businesses, noting that financing constraints remain a major challenge across the agricultural value chain.
He explained that Sterling Bank’s strategy focuses on directing financial resources towards sectors where access to capital can produce meaningful economic outcomes.
Proparco strengthens partnership with Nigeria
Christophe Lecourtier said the partnership would support access to clean energy, strengthen agricultural SMEs and encourage investment in local production.
He also highlighted the importance of cooperation between Nigerian and French businesses in promoting economic development and creating employment opportunities.
The partnership aligns with Proparco’s broader commitment to supporting sustainable development and expanding access to finance across African economies.
By working with local financial institutions, the organisation can channel funding towards businesses and projects that contribute to economic growth and environmental sustainability.
Sterling Bank’s HEART strategy
The financing arrangement also supports Sterling Bank’s HEART strategy, which prioritises five major sectors: Health, Education, Agriculture, Renewable Energy and Transportation.
The bank has continued to position the strategy as a framework for directing financing towards areas with the potential to improve economic and social development.
Sterling Bank has also set a target of achieving carbon neutrality by 2050.
Its environmental initiatives include installing solar power systems at its headquarters and nearly half of its branches and automated teller machines.
The bank also operates Imperium, a platform that provides access to renewable energy equipment and services.
Additionally, its mobility initiatives promote electric transportation and seek to create employment opportunities, particularly for women.
The institution’s OneWoman initiative also supports women entrepreneurs through programmes aimed at improving their business skills and growth opportunities.
Implications for Nigeria’s economy
The $30 million agreement represents an important financing opportunity for renewable energy businesses and agricultural SMEs.
If effectively deployed, the facility could help improve electricity access, reduce business operating challenges and strengthen agricultural production.
It also demonstrates the role that partnerships between Nigerian banks and international development finance institutions can play in mobilising capital for important economic sectors.
However, the overall impact will depend on how efficiently the funds are distributed, the quality of projects financed and the ability of beneficiary businesses to utilise the resources productively.
For Sterling Bank and Proparco, the partnership provides an opportunity to combine financial resources and development expertise to support Nigeria’s energy transition and agricultural growth.
