The fund, which caters to individuals between the ages of 15 and 35, comes at a time when locals are worried by the collapse of U.S. startup-focused lender SVB Financial Group, which sponsored entrepreneurs in Nigeria.
Only one cross-border payments startup, Chipper Cash, has so far claimed to have $1 million in SVB. However, some of the biggest firms, such as the e-commerce company Jumia and the fintech company Flutterwave with a focus on Africa, have revealed they had no contact with the bank.
What The $618 Million By Nigeria Will Be Used For
The $618 million Investing in Digital and Creative Companies (iDICE) fund was officially established by Vice President Yemi Osinbajo in Abuja, the nation’s capital, according to a statement from the presidency.
According to the presidency, the African Development Bank would contribute $170 million, Agence Française de Developpement will contribute $116 million, and the Islamic Development Bank will contribute another $70 million.
The vice president also underlined the value of a coordinated approach to innovation throughout Africa in his remarks at the event.
“It is now essential to start a coordinated approach towards innovation on the continent, gathering all stakeholders to coordinate efforts at scaling up investments and building programs that provide the right enabling environment and produce talent pipelines that support the growth of innovation on the continent,” said Osinbajo.
While the private sector has committed $217 million, the government, through the Bank of Industry Nigeria, will disburse $45 million.
“iDICE is a government initiative to promote innovation and entrepreneurship in the digital tech and creative industries and especially targeted at job creation,” Osinbajo was quoted as saying at the launch of the fund.
Nigeria has the largest number of startups in Africa – mostly in tech and fintech – which have pulled funding from overseas banks and venture capital firms.
But most startups still struggle to attract funding because banks demand that they provide collateral, which they do not have.
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