Small businesses need infrastructure, not just loans – FCMB exec

Reliable infrastructure, skills development and digital access are more critical than financing alone for Nigerian SMEs to scale, according to George Ogbonnaya, Senior Vice President and Divisional Head of Business Banking at FCMB. He identified energy, logistics and digital connectivity as key constraints to growth, noting that energy costs now make up around 60 per cent of operating expenses for many small businesses, up from about 40 per cent previously. This surge in energy costs, driven by unreliable power supply, directly affects profitability and sustainability. Ogbonnaya said logistics networks within Africa remain inefficient and costly, limiting trade and expansion opportunities. Digital infrastructure, he added, is equally vital, as technology now drives competitiveness and access to markets. Beyond infrastructure, he stressed the need for skills development, particularly in management and leadership, to help entrepreneurs transition from sole operations to scalable businesses. Market access and simplified regulatory processes are also essential, as many SMEs lack resources to navigate complex compliance requirements. FCMB, Ogbonnaya said, operates as a long-term partner rather than a transactional bank, shaped by its history as Nigeria's first indigenous bank and its role in supporting local economic participation. The bank is focused on helping businesses navigate high inflation, rising interest rates and increased operating costs by offering tailored support. While financing remains important, many businesses struggle not due to lack of credit access but because of high borrowing costs, insufficient skills or inability to meet formal requirements.

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