From graduate studies spanning continents to a career dedicated to development finance, Elizabeth Boggs Davidsen, CEO of GSG Impact, recently shared her insightful journey with the Nigerian impact investing ecosystem during her visit to Nigeria for  the 2025 Africa Impact Summit Study Tour to Nigeria

In a dynamic fireside chat moderated by the Mrs. Ibukun Awosika, Chair of the GSG Nigeria  Partner and Vice President, GSG Impact, a vibrant discussion unfolded, focusing on the evolving landscape of microfinance, the urgent need for innovative financial instruments, and strategic pathways to unlock impact capital for Micro Small and Medium Enterprises (MSMEs)  in key economic sectors and the burgeoning blue economy across Africa. The conversation drew insights from other participants who voiced crucial concerns and perspectives on corporate impact investing, the complexities of impact metrics, and partnership frameworks required to truly strengthen the ecosystem. 

The fireside chat served as a vital platform for stakeholders from across the continent to actively participate. Important issues regarding the nuances of corporate impact investing, the challenges of effectively measuring and standardising impact metrics in diverse local contexts, and the necessity of establishing robust partnership frameworks that foster genuine collaboration and shared value within the ecosystem were raised.

Beyond Small Loans: The Evolution of Microfinance and the Urgency for Innovation

The discussion began by acknowledging the foundational role microfinance played in providing early access to capital for underserved communities and pivoted to the consensus that traditional microfinance models now face significant structural limitations in effectively supporting the growth ambitions of innovative and high-potential SMEs. The scale and complexity of these businesses demand more sophisticated financial instruments and tailored support.

Unlocking Capital for SMEs Across Sectors

A central theme of the conversation was exploring innovative financial solutions capable of directly supporting SMEs and tapping into the immense potential of Africa’s blue economy. The need for robust institutional backing for these innovative approaches was emphasised, alongside the importance of nurturing and leveraging private capital. The complementary role of providing dedicated business advisory assistance to these enterprises was also highlighted as crucial for sustained growth and success.

Navigating the hurdles in Nigeria’s  impact investing ecosystem

The dialogue revealed several  challenges within the impact investing ecosystem some of which are: limitations of traditional microfinance models; inefficiencies in traditional MSME financing channels; lack of investment readiness and business advisory support; limited local capital mobilization; inadequate risk sharing and guarantee structures; corporate impact investing constraints; and gaps in impact metrics and standardisation.

Local solutions tailored to specific regional needs and challenges

In response to these challenges, a series of actionable recommendations were presented to strengthen Africa’s impact investing ecosystem and drive sustainable, inclusive growth:

• Develop Innovative Financial Instruments: Create blended finance and concessional capital structures that bypass traditional banking and directly support SMEs.
• Anchor Financing with Local Capital: Utilize local institutions and government entities to establish foundational capital, attracting further international investment by signaling reduced risk.
• Expand Business Advisory and Enterprise Support Systems: Provide subsidized support for business development, accelerators, and technical assistance to enhance entrepreneur investment readiness.
• Implement Risk Sharing Mechanisms: Introduce guarantees and first-loss structures, potentially backed by central banks or development finance institutions, to encourage investment in undercapitalised sectors.
• Strengthen Corporate Impact Investing Channels: Encourage corporate capital allocation into structured impact funds or through partnerships with established impact investors, with support for developing local National Advisory Boards (NABs).
• Standardize and Localize Impact Metrics: Promote the adoption of adaptable global frameworks like ISSB and IRIS+, while collaborating with local regulators to ensure relevance.
• Facilitate Knowledge Sharing and Localization of Solutions: Encourage South-South learning through platforms like GSG’s Global Leadership Meetings (GLM) to adapt and replicate successful models within local contexts.

The insights and recommendations emanating from this vital fireside chat offered a clear roadmap for fostering a more robust and impactful investment landscape across Africa, one where innovation thrives, local capital is mobilised, and MSMEs are empowered to drive sustainable and inclusive economic growth.

CAPTION: Cross-section of guests and speakers at the High-Level Roundtable of Policymakers and Investors at the 2025 Africa Impact Summit Study Tour to Nigeria

Also during a panel session titled “Impact Investing in Nigeria: Progress, Trends, and Future Outlook” industry leaders critically assessed the evolving landscape of impact investing in Nigeria highlighting successes, identifying barriers, and mapping pathways for future growth.

The panel moderated by Ms. Atieno Otonglo, Africa Market Development Manager at GSG Impact, featured leaders from Nigeria’s impact investing ecosystem: Ms. Tosin Ojo, Partner at Sahel Capital; Mr. Oguche Agudah, CEO, PenOp; Ms. Kudzayi Hove, CEO, Amayi Foods; and Mr. Labi Williams, Partner and Managing Director, Kuramo Capital Management LLC. They explored how impact capital can drive growth across diverse sectors and discussed the Nigeria Wholesale Impact Investment Fund (WIIF), which uses its innovative “ABC” model—Accelerate, Bridge, and Co-Invest, to support first-time fund managers and mobilise private investment for SMEs.

Deepening partnership with the Public Sector

A high-level delegation led by Mrs Awosika, which included Ms Davidven;  Ms Otonglo; Etemore Glover, CEO, Impact Investors Foundation and CEO, Kuramo Capital Management LLC, Wale Adeosun; met with key government officials, including the Honourable Ministers of Finance and Budget and Economic Planning, and the Director General of PenCom, to strengthen relationships and advance discussions on the Nigerian government’s $50 million anchor fund for the $1 billion Nigeria Wholesale Impact Investment Fund (WIIF). The initial fundraising target for the naira-denominated financial vehicle is $100 million. This fund aims to attract private investors alongside the government’s anchor investment, providing much-needed local currency capital to Nigerian SME-focused fund managers and mitigating foreign currency risk.