The level of commercial bank funding in Nigeria to MSME s over the years has dropped from a high of 46 % of their total loan portfolio in 1992 to less than 1 % in 2012. It seems that some of this slack has been picked up by micro finance institutions. Following the guidelines for microfinance in Nigeria, there was a proliferation of players in that space such that there are currently over 800 micro finance banks in the country today. Whilst commercial banks’ lending to MSMEs have dropped, lending by microfinance banks has grown exponentially.