Sage Grey Finance Limited has launched a $10 million Circular Economy Impact Fund (CEIF) to address one of the biggest constraints facing Nigeria’s green economy: limited access to affordable finance for circular economy businesses that are often deemed too risky by conventional lenders.
The fund, unveiled in Lagos in partnership with the Circular Business Platform, Perazim Impact Consulting and supported by the Netherlands Consulate, is designed to provide structured debt financing, technical assistance and governance support to startups and small businesses operating in recycling, waste-to-value, renewable energy, green manufacturing and other circular economy sectors.
Although Nigeria’s circular economy is expanding, many enterprises remain informal and unable to secure bank financing because they lack collateral, financial records or governance structures.
According to Sage Grey, the financing gap has prevented many viable businesses from scaling despite rising investor interest in sustainable projects.
“The problem with the space is that you have people who are usually very small, usually very informal,” said Dumebi Okeke, secretary of the Fund. “The average bank is asking for collateral, audited accounts and years of financial history. Many startups simply don’t meet those requirements.”
Structured as an unincorporated private debt fund, CEIF will deploy capital through four funding buckets, ranging from technical assistance for idea-stage businesses to growth financing for mature enterprises.
The facility is denominated in US dollars but will be disbursed in naira, with investments expected to create a pipeline of “bank-ready” businesses capable of attracting larger institutional capital.
Unlike traditional grant programmes, the fund adopts a revolving debt model intended to preserve capital while encouraging stronger governance, financial discipline and commercial viability among beneficiaries.
Temitope Runsewe, managing director of Sage Grey Finance, said the facility was designed to provide financing that reflects the different stages of business growth, enabling companies to access capital from startup through expansion before graduating to larger investors.
Beyond financing, the fund seeks measurable economic and environmental outcomes. It targets financing for 120 businesses, creation of more than 3,000 direct and indirect jobs, prevention of 10,000 metric tonnes of carbon emissions, diversion of up to 50,000 metric tonnes of waste, while reserving 30 percent of funding for women-led enterprises.
“We thought there was a gap in terms of nimble capital that’s patient enough,” said Opeyemi Oriniowo, policy adviser on Economic Affairs and Public Diplomacy, Netherlands Mission in Nigeria.
He noted that expecting SMEs to borrow at commercial lending rates of 30 to 40 percent makes it nearly impossible for them to become profitable or repay loans.
Oriniowo stated that the fund seeks to respond to the financing needs of businesses operating in the circular economy while supporting Nigeria’s broader transition towards sustainable economic growth.
Sage Grey said the initiative builds on its experience financing circular economy ventures such as FREEE Recycle and is intended to institutionalise impact investing in Nigeria through stronger governance, independent oversight and rigorous impact measurement.
The fund is audited by Deloitte Africa, advised legally by Aluko & Oyebode, and governed by an Investment Committee and Advisory Committee.