Funmi Ogundare
Sage Grey Finance is targeting a significant increase in the share of manufacturing in its lending portfolio, with plans to raise it from the current 15–20 per cent to as much as 60 per cent as part of efforts to channel more capital into Nigeria’s real sector.
The Managing Director and Chief Executive Officer, Temitope Runsewe, disclosed this at the organisation’s 10th anniversary celebration in Lagos, attended by stakeholders in the financial services sector, diplomats, business leaders, clients and partners.
Runsewe said the proposed expansion reflected the strategic importance of manufacturing to Nigeria’s economic development, adding that the company was exploring ways of providing longer-term capital to businesses in the sector.
“As of now, we have probably 15 per cent or 20 per cent in manufacturing. Ideally, because that’s the real sector, ideally it should be as high as maybe 50 or 60 per cent,” he stated.
He explained that the organisation was also considering a value-chain financing model that would extend funding beyond manufacturers to businesses providing essential inputs and services to them.
“The second part is value-chain financing, which means we can fund you and fund everybody in your value chain,” Runsewe said.
Under the proposed model, he explained that businesses providing power, security, intermediate products and other essential services to manufacturers could also access financing.
According to him, manufacturers continue to face several constraints, including currency devaluation, high electricity costs, shortages of skilled manpower, inadequate infrastructure and insecurity.
He stressed the need for longer-term capital to enable businesses in the sector to overcome some of these challenges and expand their operations.
The manufacturing-focused lending strategy forms part of Sage Grey Finance’s broader expansion plans as the organisation prepares to raise fresh capital through a stock market listing ahead of its proposed transition into a commercial bank.
Its 10th anniversary presentation indicated that Sage Grey plans to list on the Nigerian Exchange and transition into a commercial bank by 2027, with a longer-term ambition of building a Tier 1 Nigerian bank.
As part of its sustainability and impact strategy, the organisation has also established a $10 million circular economy impact fund with partners to support businesses operating in areas including recycling, clean energy and green manufacturing.
Runsewe said its strategy for its next phase would focus on consolidating, optimising and scaling the businesses it had built during its first decade.