Cascador and Sterling Bank Announce $200M SME Credit Backstop Fund, a Catalytic Vehicle to Expand Capital for Growth-Stage Nigerian SMEs

Cascador and Sterling Bank have announced a $200 million SME Credit Backstop Fund, an independent platform designed to expand access to growth capital for debt-ready Nigerian small and medium-sized enterprises (SMEs). The fund will provide a defined credit-risk backstop to participating finance partners, with the model supporting up to $1 billion in outstanding credit capacity.

The initiative follows Cascador’s white paper, The Multiplier Model, which examines the constraints limiting African businesses’ ability to scale and the importance of matching capital to each business’s needs and maturity. Across Sub-Saharan Africa, businesses finance a greater share of investment through equity than the global norm, reflecting the limited availability of debt as a suitable source of growth capital. Only 22% of businesses in the region hold a bank loan or line of credit, compared with a global average of 36%. The fund responds to this gap by creating a structured route to larger, longer-term loans for businesses that are ready to borrow but face barriers to accessing debt.

Cascador brings experience identifying, supporting and investing in businesses with the potential to scale, while Sterling Bank contributes lending infrastructure and credit-market expertise. The fund will also bring SME ecosystem partners, finance partners and backstop capital providers, such as philanthropic funders, impact investors and development-finance institutions, together in a single risk-sharing model that supports the guarantee reserve and helps mobilize additional SME lending. Trish Thomas, CEO of Cascador, said that by sharing risk with lenders and “translating community trust into a bankable signal to lend,” the fund can help more businesses with proven traction access the capital they need to scale and create jobs.

The model works across four parts of the financing chain. SME ecosystem partners identify and nominate businesses that meet the fund’s debt-readiness standards. The fund applies its own eligibility, guarantee and portfolio-risk standards, using AI-powered underwriting and due diligence, and provides a defined backstop against losses for approved borrowers. Finance partners independently assess borrowers, approve and disburse loans, and retain responsibility for servicing, monitoring and collections. SMEs can initially access local currency loans equivalent to $250,000, with longer-term financing aligned to business cash flows and subject to lender approval. The fund aims to unlock loan sizes of up to $1,000,000 once fully funded.

For SMEs, the model is intended to provide larger, longer-tenor growth capital with reduced collateral and guarantee burden. Finance partners gain access to a pipeline of debt-ready businesses alongside structured risk sharing, while ecosystem partners gain a financing route for proven businesses that have progressed beyond early-stage support and are ready for commercial debt.

Obinna Ukachukwu, Group Executive at Sterling Bank, said the partnership addresses lending risk across the entire financing journey. He said that the credit backstop, businesses recommended by participating venture funds and studios, and structured assessment and ongoing monitoring together give Sterling greater confidence to provide larger, longer-term loans.

The fund will operate through Riverwell Platform Holding Limited, a UK-owned technology-enabled SME infrastructure platform, and Riverwell Platform Services Nigeria, with reserve capital held separately. The Nigerian operating company will oversee partner coordination, business-readiness, assessment, data collection, portfolio monitoring and reporting, while the reserve company holds and manages the capital supporting the backstop. Ukachukwu will also serve as a director on the Riverwell platform, bringing Sterling’s banking expertise to guide financing structures, credit-risk oversight and portfolio monitoring.

The fund is based on the Catalytic Fund structure piloted over the past two years by Cascador, as nominator and guarantor, and Sterling, as lender. It will be independently managed to ensure sustainability and discipline while allowing participation from a range of ecosystem partners. Since 2019, Cascador has supported 80 ventures that have collectively raised over $150 million in capital.