Government initiative seeks to remove registration costs and bring more small businesses into the formal economy
UNITY TIMES BUSINESS DESK
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ABUJA — The Federal Government has opened applications for a programme offering free Corporate Affairs Commission (CAC) business-name registration to 250,000 Micro, Small and Medium Enterprises (MSMEs) across Nigeria.
The initiative, approved by President Bola Ahmed Tinubu, is designed to remove one of the barriers confronting small entrepreneurs: the cost and bureaucracy associated with formalising a business.
Under the programme, eligible nano, micro and small businesses can have their statutory business-name registration fees covered by government. The initiative was unveiled during the 8th National MSME Awards in Abuja.
Why formalisation matters
For millions of Nigerian entrepreneurs, the journey begins informally.
A trader may operate from a roadside stall. A tailor may work from a room in a family house. A food vendor may run a small kitchen business. A young technology entrepreneur may provide services entirely through social media.
But operating outside the formal economy can make it harder to access loans, government programmes, corporate contracts and other opportunities.
Business registration provides a formal identity that can help entrepreneurs establish credibility with customers, financial institutions and larger companies.
More than a certificate
The government says the programme goes beyond registration.
Beneficiaries are also expected to receive access to business development support and technical training intended to improve the sustainability of their enterprises. That component is crucial.
Registration alone cannot make a struggling business profitable. A small enterprise still needs affordable credit, electricity, reliable internet, transport infrastructure, market access, predictable taxation and protection from multiple or arbitrary levies.
The success of the programme will therefore depend on whether formalisation becomes the beginning of broader support rather than the end of the process.
A huge sector of the Nigerian economy
MSMEs occupy a central position in Nigeria’s economic structure.
The Presidential Enabling Business Environment Council (PEBEC) says MSMEs represent more than 90 per cent of businesses in Nigeria, contribute nearly half of GDP and account for a substantial share of employment.
This makes policies targeting small businesses economically significant.
If hundreds of thousands of enterprises become formally registered, government could also gain a better understanding of the size, location and composition of the country’s business community.
That information could improve policy planning.
Digital registration
The CAC already operates a digital registration system through its Company Registration Portal.
The Commission says business-name registration can be completed online, with applicants able to conduct name availability checks, submit documentation and receive electronic registration documents.
The digital system is part of broader reforms aimed at reducing bureaucratic barriers to starting a business.
PEBEC similarly identifies simplified business registration, digital signatures, automated name reservation and online processing among Nigeria’s business-environment reforms.
The challenge of reaching the informal economy
The biggest question may not be whether 250,000 registrations are possible. It is whether the programme can reach the entrepreneurs who need it most.
Many informal businesses operate far from major cities and may have limited access to reliable internet, digital payment systems or information about government programmes.
Women-owned microbusinesses, rural enterprises and young entrepreneurs may therefore require additional outreach.
Government agencies will need to work with states, business associations, cooperatives and community organisations to ensure that the opportunity does not become concentrated among entrepreneurs who are already digitally connected.
From informal hustle to formal enterprise
For Nigeria’s millions of small entrepreneurs, formalisation can be an important step towards building businesses capable of surviving beyond their founders.
But the deeper test is whether the policy environment allows those businesses to grow.
A registered business still needs customers. It still needs electricity. It still needs affordable finance. It still needs infrastructure. And it still needs a regulatory environment that rewards compliance rather than making informality appear easier.
The 250,000 free registrations could therefore be an important starting point.
The real measure of success will be how many of those newly formalised businesses are still operating, expanding and creating jobs several years from now.
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