Access to capital remains a key complaint by most entrepreneurs across the continent of Africa, especially women entrepreneurs. Luckily, one bank is doing something about it.
Nigeria’s Bank of Industry (BoI) recently announced the launch of 1 billion Naira (an estimated $5m million) fund for Nigeria’s exploding fashion industry. Speaking through it bank representative,
Rasheed Olaoluwa, the Bank’s Managing Director, BoI explained that the goal was to support small and medium size business owners.
Citing the creativity of Nigerians and the Nigerian fashion industry and the academic credentials of many industry professionals who study fashion in some of the best fashion schools across the globe, he stressed the fund is an initiative under the Gender Unit of the bank which targets women-owned businesses only.
“There has been a lot of talk about SME funding, but with less actions. This is why BoI has decided to increase its funding initiatives to cluster creations,” said Olaoluwa.
“BoI has so far recognised 34 cluster creations nationwide to drive our funding initiatives. So, we are able to tailor each cluster based on its peculiarities.
We are excited about this fund because of the impact it is going to make in promoting job creation, especially among the youths because fashion business globally is worth about $1trillion.
And with the growing population of over 170 million, increasing purchasing power of the middle class, it is obvious that fashion business is, and will be a money spinner for Nigeria’s economy in the next few years,” he explained.
Agreeing with the sentiments of Olaoluwa and speaking in behalf of one of the oldest fashion organizations in Nigeria, Funmi Ajila-Ladipo, President of Fashion Designers Association of Nigeria (FADAN), praised BoI for its initiative.
Ajila-Ladipo stressed the need for fashion education, capacity building, helping businesses scale, more production hubs and vocational centers.
Nigerian designers seeking funds for expansion can now approach the Bank of Industry which has launched the N1 Billion Fashion Fund for players at the micro-, small- and medium-scale levels. The Fashion Fund joins two other SME funds recently launched by the country’s development bank: the 5 Billion Cottage Agro Processing Fund and the 1 Billion NollyFund. Rasheed Olaoluwa, managing director/chief executive officer, BOI, said the Fashion Fund is in fulfillment of the bank’s commitment to develop special funds and credit products to deepen penetration of and enhance support to specific SME clusters.
“We see an opportunity to support Nigeria’s leading fashion businesses to increase their production volumes and quality, thereby making them more competitive in both the domestic and international markets,” Olaoluwa said.
“In Nigeria, our own African prints, known as Ankara fabrics, have become very popular in the fashion world due to the ingenuity and industry of Nigerian designers such as Dakova, Frank Oshodia, Tiffany Amber and Deola Sagoe, among others. Amazing designs are now created using local fabrics and are featured in both local and international fashion shows,” he observed.
Our MD pointed out that many of Nigeria’s fashion designers have received training in some of the best fashion schools in the world, and therefore have the intellect, talent, creativity, skills and drive to take Nigeria’s fashion industry to the next level on the global fashion stage. He said the growth in Nigeria’s urban population, the macro-economic environment, increasing purchasing power of the emerging middle class and a strong appetite for consumer goods are positive factors in favour of a flourishing fashion cluster. He explained that fashion provides an important opportunity to diversify Nigeria’s economy and create jobs, particularly among the youth, expressing confidence that the Fund will help to catalyze the fashion cluster, create millions of jobs and also generate foreign exchange earnings for businesses and economy. He disclosed that the bank has identified 34 SME clusters nationwide through which it will drive its new SME financing paradigm.
“At the Bank of Industry, we have resolved to strategically approach the issue of SME financing using the cluster approach, which has been successfully implemented in many fast-growing economies in the world. India is a very good example, where hundreds of SME clusters have been identified and developed,” he explained. He further said that in the months ahead, more funds and product programs will be designed and launched to support the various SME clusters already identified.
“Essentially, our cluster approach recognizes that one size does not fit all. Consequently, we are able to tailor our lending criteria to the peculiarities of each cluster, based on a deep analysis and understanding of the dynamics of each SME cluster,” the BoI CEO added. Ojomo Ochai, director of arts and designs for British Council in Nigeria, said the bank is one of the Council’s most trusted and reliable partners.
“We’ve worked with them on various projects. We are working with them around creative people and to train individuals on how to build more sustainable business. BOI has consistently shown willingness to invest not just for direct benefits, but for wider benefits of the industry,” Ochai said. Funmi Ajila-Ladipo, national president, Fashion Designers Association of Nigeria (FADAN), said there is the need to create a production hub for the industry. “I keep saying this all the time. If one person is given N3 million, and another person is given N6 million or N7 million, at the end of the day, it still amounts to nothing. We will still keep going round and round until we have a production hub,” Ajila-Ladipo said.
“We have so many talented people all over Nigeria, not only in Lagos. We need to bring all these people together and give them opportunity. We want to stop consuming from other nations; we want to manufacture. We don’t want to buy those second-hand clothes. We don’t want to wear those rejects that they throw back at us,” Ajila-Ladipo further said. On her part, Nike Ogunlesi, MD, Rough & Tumble, while supporting the call for a production hub, said designers need to focus on building brands that will outlive them. “This is an opportunity to create jobs. The timing is right, so let us focus on the technical skills to build the industry. We need to have technical schools, train people, and show the world that we know what we are doing,” Ogunlesi said.
Check out photos and watch a discussion on the new fund below.