Cascador, a Nigeria-focused platform for growth-stage founders, and Sterling Bank have set up a $200 million fund to help small Nigerian businesses and startups get bank loans, according to TechCabal.
How it works
The fund does not lend directly. TechCabal reports that it guarantees part of the bank's potential losses if a borrower defaults. It will consider businesses nominated by venture capital firms and studios that already back them, and use AI-powered underwriting to check whether a company is ready to take on debt.
Sterling still decides whether to lend after its own checks, disburses the loans, collects repayments and pursues defaulters. The backstop is meant to reduce the bank's exposure, not remove it.
The size and the starting point
Borrowers can start with local-currency loans of up to $250,000, and the fund plans to raise that to $1 million, according to TechCabal. The partners expect to raise the backstop capital from philanthropic funders, impact investors and development finance institutions, so $200 million is the stated fund size and $1 billion is the lending capacity it aims to support.
Why it matters
TechCabal cites World Bank Enterprise Survey data showing about one in five Nigerian businesses had a bank loan or line of credit in 2025, against 22% across Sub-Saharan Africa and 36% globally.
Equity is also tight. TechCabal says only 190 African startups raised $100,000 or more in the first half of 2026, the lowest since at least 2021, while African startups borrowed a record $1.64 billion in 2025, with debt making up 41% of their funding.
"Equity must work with debt and long-term securities to provide builders with the capital they need to build the future," said Iyinoluwa Aboyeji of Future Africa, according to TechCabal.
