Cascador & Sterling Bank Launch USD 200 M SME Credit Backstop Fund

Cascador and Sterling Bank have launched a USD 200 M SME Credit Backstop Fund to help Nigerian startups and small businesses access up to USD 1 B in bank loans. The fund will guarantee part of lenders’ potential losses if borrowers default, reducing the risk banks face when lending to businesses that struggle to secure traditional financing.

The fund will use AI-powered underwriting to assess businesses nominated by venture capital firms and startup studios. Sterling Bank will make lending decisions and manage repayments, while the backstop provides partial protection against defaults. Eligible businesses can initially access local-currency loans worth up to USD 250 K, with plans to increase the limit to USD 1 M.

The partners plan to raise capital from philanthropic funders, impact investors and development finance institutions. The initiative expands their 2025 debt financing partnership beyond Cascador alumni to startups backed by other investors.