The Federal Government has approved a new programme that will allow 250,000 Nigerian entrepreneurs to register business names free of charge, in one of the most significant formalisation drives targeted at the country's nano, micro and small enterprises in recent years.

The initiative was unveiled on June 27, 2026, at the 8th National MSME Awards held at the State House in Abuja, where President Bola Ahmed Tinubu gave his approval for the scheme to proceed. The programme is the product of a partnership between the Small and Medium Enterprises Development Agency of Nigeria, known as SMEDAN, and the Corporate Affairs Commission, known as CAC, the two agencies most directly responsible for supporting and registering small businesses across the country.

What Was Announced

Under the arrangement, 250,000 business names will be registered at no cost to the applicants. The offer is open specifically to owners of nano, micro and small enterprises, the segment of the economy that accounts for the overwhelming majority of Nigerian businesses but has historically had the lowest rates of formal registration. Officials at the event described the programme as a direct response to years of complaints from small business owners that the cost and complexity of registration, however modest it may seem on paper, remain a real barrier for traders, artisans and service providers operating on thin margins.

A business name registration is the simplest form of business formalisation available in Nigeria. It allows an individual or a group of individuals to trade under a registered name without incorporating a limited liability company, and it is the route most commonly used by sole proprietors, market traders, tailors, food vendors, repair technicians and similar operators. For many of these businesses, a registered name is the first documentary step toward opening a dedicated business bank account, applying for a loan, bidding for a local government contract or simply being taken seriously by customers and suppliers.

To understand the significance of this move, consider the typical cost of a business name registration in Nigeria. Under standard CAC fee schedules, a business name registration normally costs around NGN 10,000 to NGN 15,000 depending on the specific processing route and any agent fees involved. This amount, while not enormous to a formal company, can be prohibitive for a market trader in Lagos who earns between NGN 3,000 and NGN 5,000 in net profit on a good day. For a rural cassava processor in Oyo State operating on margins of NGN 2,000 per week, the fee represents several weeks of savings. Over the years, countless potential entrepreneurs have cited these costs as a reason to remain unregistered, operating entirely in cash and without legal documentation.

The 250,000 free registrations effectively remove this barrier entirely for a significant cohort of small-scale operators. To put the number in context, the CAC registered roughly 700,000 business names in total across all of 2024, meaning this single programme could boost formal registrations by more than a third in a single year. If the scheme is fully utilized, it could add a substantial chunk of previously invisible economic activity to the formal records used by the National Bureau of Statistics and the Central Bank of Nigeria for planning and credit programmes.

Inside the SMEDAN-CAC Partnership

The programme was formalised through a memorandum of understanding signed by the Registrar-General of the CAC, Hussaini Ishaq Magaji, and the Director-General of SMEDAN, Charles Odii. Speaking at the unveiling, both officials framed the initiative as part of a broader push to bring Nigeria's vast informal sector into the formal economy, where it can be counted, taxed fairly, supported with credit and factored into national planning.

SMEDAN has for years positioned itself as the primary government agency responsible for the welfare of small businesses, running training programmes, cluster development schemes and access-to-finance initiatives. The CAC, for its part, is the sole statutory body empowered to register companies, business names and incorporated trustees in Nigeria. A joint programme between the two agencies effectively combines SMEDAN's reach into the small business community with the CAC's registration infrastructure, allowing applicants to be identified, guided and registered through a single coordinated process rather than navigating both agencies separately.

The operational mechanics of this partnership are worth examining. SMEDAN has existing networks through its 37 state offices and over 100 local government area liaison points, which it uses to identify and support small business owners. Under the new arrangement, SMEDAN's field officers will help verify the eligibility of applicants, ensuring they qualify as nano, micro or small enterprise owners under the official definition. Enterprises are classified based on number of employees and asset base, excluding land and buildings: nano businesses employ fewer than 3 people and have assets under NGN 2 million, micro businesses have 3 to 9 employees with assets under NGN 10 million, and small businesses have 10 to 49 employees with assets under NGN 50 million. Once an applicant is confirmed as falling within one of these categories, the CAC streamlines the registration process, using its automated systems to issue the business name certificate without charging the standard filing fees.

Neither agency has published a detailed breakdown of how the 250,000 slots will be distributed across states or sectors. What has been made clear is that the registrations are being treated as a finite allocation rather than an open-ended entitlement, which is why officials have repeatedly stressed the first-come, first-served nature of the exercise. Some informal discussions among industry observers suggest that states with high concentrations of informal enterprises, such as Lagos, Kano, and Rivers, are likely to see high demand, but no quotas have been officially set.

How to Apply

Applications are being received through a dedicated online portal, portal.smedan.gov.ng, rather than through the CAC's regular company registration portal. Prospective applicants are expected to complete their applications on this platform, where they will be required to provide their National Identification Number, or NIN, as part of the verification process.

The NIN requirement is consistent with the government's broader push in recent years to link virtually all forms of civic and commercial registration, from SIM cards to bank accounts to voter registration, to a single verified national identity record. For the business name programme, it also serves a practical purpose. It allows SMEDAN and the CAC to confirm that each of the 250,000 slots goes to a distinct, verifiable individual, reducing the risk of the allocation being exhausted by bulk or fraudulent applications.

The use of NIN ties into Nigeria's National Identity Management Commission database, which currently holds over 100 million enrolments. By requiring NIN, the government can cross-check applicant data against existing identity records, a process that takes seconds via the NIMC verification API. This digital layer makes it far harder for someone to register 20 business names under different aliases, a tactic that has sometimes been used to exploit free or subsidised registration schemes in other countries. In practice, an applicant will enter their NIN online, the system will call up their name, date of birth, and other basic details from the NIMC database, and a successful match will open the way for the CAC to issue the business name certificate automatically in many cases.

Officials have been explicit that the entire process, from application to the eventual issuance of a registered business name, will not cost applicants anything. There is no filing fee, no processing charge and no premium tier for faster registration. Given that first-come, first-served allocations of this kind tend to fill up quickly once word spreads, business owners who intend to take part have been advised to apply as soon as the portal is available to them rather than assuming slots will remain open indefinitely.

To make the scheme accessible to those less familiar with online portals, SMEDAN is reportedly considering setting up physical application assistance points at its state offices and selected local government secretariats. Business owners who lack internet access or digital literacy skills can visit these centres, where trained personnel will help them complete the online form and verify their NIN. This dual approach, direct online applications plus assisted submissions through field offices, mirrors strategies used by India's Udyam registration portal which successfully registered millions of micro-enterprises partly by providing offline help in rural areas.

Why Business Names, Not Limited Companies

The scheme is deliberately restricted to business name registration and does not extend to the incorporation of limited liability companies. This distinction matters because the two forms of registration serve different purposes and carry different obligations.

A business name registration is quick, inexpensive under normal circumstances, and imposes comparatively light ongoing compliance obligations. It suits the sole trader who wants a recognised name to put on invoices, signage and bank documents but has no immediate need for the separate legal personality, shareholding structure or more demanding filing requirements that come with incorporating a limited company. A limited company, by contrast, is typically the preferred vehicle for businesses that intend to raise external capital, bring in partners or shareholders, or limit the personal liability of their owners.

By focusing the free registration programme on business names, SMEDAN and the CAC are targeting the segment of entrepreneurs for whom even modest registration costs have historically been a genuine deterrent, rather than businesses that are already at a stage of growth where incorporation would be the more natural next step. It is, in effect, an entry-level formalisation tool aimed at pulling informal traders into the documented economy, with the expectation that some proportion of them will graduate to full incorporation as their businesses expand.

The practical implications for a registered business name holder are significant. For example, a tailor in Surulere who registers as "Deola Fashions" under this scheme can then open a bank account in that name, receive payments via point-of-sale transfers from customers, and apply for trade credit from fabric wholesalers. Without that registration, the tailor would likely have to operate using a personal bank account, mixing personal and business finances, and would be ineligible for many small business loan programmes offered by banks like Access Bank or UBA, which require a formal business legal document. The registration also allows the tailor to issue invoices that look professional, helping to attract corporate clients who demand proper receipts.

A Warning on Agents and Middlemen

Both agencies have issued explicit warnings to prospective applicants not to pay any individual or intermediary claiming to offer expedited access to the free registration slots. Nigeria's registration and licensing processes have long attracted informal agents who charge desperate applicants for services that are, in principle, free or already included in a stated fee. With a scheme of this scale and profile, the risk of opportunistic middlemen exploiting public enthusiasm is considered high enough that officials chose to address it directly at the unveiling rather than waiting for complaints to surface later.

Applicants have been urged to apply only through the official portal at portal.smedan.gov.ng and to treat any request for payment, whether framed as a processing fee, an agent's commission or a fast-track charge, as a red flag. Business owners who encounter such demands are expected to be able to report them through SMEDAN or CAC channels, though neither agency has yet detailed a dedicated fraud-reporting line specific to this programme.

The history of such scams in Nigeria is instructive. During the registration amnesty for micro, small and medium enterprises in the early 2000s, reports emerged of individuals posing as CAC agents, collecting fees of NGN 5,000 to NGN 20,000 from small business owners, and then disappearing without providing any registration documents. In another instance linked to a SMEDAN training programme, fake agents collected money from rural women in Kaduna State for supposed certification that never materialised. To prevent a repeat of these cases, SMEDAN and the CAC are relying heavily on public awareness campaigns through radio jingles, social media posts and notices at market associations, emphasising that the scheme is entirely free.

Context: Nigeria's Informal Economy

The scale of the ambition behind this programme becomes clearer when set against the size of Nigeria's informal sector. Successive surveys by SMEDAN and the National Bureau of Statistics have put the number of micro, small and medium enterprises in the country in the tens of millions, the vast majority of them informal, unregistered and largely invisible to tax authorities, credit bureaus and government support schemes alike.

Specifically, the 2023 National MSME Survey found that there were over 44 million MSMEs in Nigeria, of which about 41 million were classified as micro-enterprises. Of these, an estimated 80 per cent operated entirely without any form of business registration. These unregistered businesses collectively contribute an estimated 50 to 60 per cent of Nigeria's GDP, according to IMF reports, but their informal status makes it difficult for them to access formal financing, which is often pegged at just 5 per cent of total lending by commercial banks. The free registration programme directly attacks this bottleneck by providing the legal foundation for credit applications.

This informality has real costs. Businesses without registered names typically struggle to open dedicated business bank accounts, are frequently excluded from government intervention funds that require proof of registration, and find it harder to access supplier credit or participate in formal supply chains. For policymakers, the invisibility of this sector also complicates efforts to measure the true size of the economy and to design interventions that reach the businesses that actually need them.

A free registration programme of this size, even if it reaches only a fraction of the eligible population, is being framed by officials as a practical, low-cost way to chip away at that informality gap. Registering 250,000 business names would not, on its own, transform Nigeria's MSME landscape, but it represents a meaningful expansion of the pool of formally recognised small businesses, particularly if it is followed, as officials have suggested it will be, by further rounds or complementary interventions.

What Comes Next

For now, the immediate task facing prospective applicants is straightforward. Visit portal.smedan.gov.ng, have a valid NIN ready, and apply before the allocation is exhausted. Neither SMEDAN nor the CAC has announced a fixed closing date for the programme, which is consistent with the first-come, first-served framing under which the scheme was unveiled.

Longer term, the success of the programme will likely be judged not just by how quickly the 250,000 slots are filled, but by what happens afterward. Officials will be watching whether the newly registered businesses go on to open bank accounts, access credit, pay into the tax net and, in some cases, take the further step of incorporating as limited companies. Those outcomes will take months, if not years, to become clear. In the meantime, the announcement at the State House has been welcomed by small business associations as a rare instance of a formalisation policy that removes a cost barrier rather than adding one, and applicants across the country are now expected to test the portal in the days ahead to see how the process actually works in practice.