Infrastructure Credit Guarantee Company Plc (InfraCredit) has secured a $50 million subordinated debt facility from the International Finance Corporation (IFC) to expand its infrastructure financing capacity in Nigeria. The 10-year unsecured facility will be disbursed in two tranches of $25 million each. This financing will strengthen InfraCredit's capital structure and increase its capacity to support infrastructure transactions across various sectors, including renewable energy, climate-smart agriculture, and healthcare.
The IFC facility is expected to support projects associated with green growth and other productive sectors of the Nigerian economy. Unlike direct dollar-denominated project lending, the facility will help InfraCredit provide guarantees and financing solutions that enable infrastructure businesses to raise longer-term funding from Nigeria's domestic capital market. This is particularly relevant for infrastructure projects that generate revenues in naira but require long-term financing, as excessive dependence on foreign-currency debt can expose businesses to exchange-rate risks.
IFC's Financial Institutions Group Director for Africa, Aliou Maiga, said the transaction aims to strengthen Nigeria's infrastructure financing system and encourage greater mobilisation of private capital. The investment reflects IFC's commitment to strengthening Nigeria's infrastructure financing ecosystem and mobilising long-term private capital. Maiga added that IFC is seeking to deepen its partnership with InfraCredit as the company develops its role in Nigeria's local capital market.
InfraCredit was established to help infrastructure companies access long-term financing from institutional investors by providing credit guarantees that improve the credit quality of eligible debt instruments. The company has facilitated over ₦600 billion in long-term local-currency financing across 28 infrastructure projects since commencing operations in 2017. InfraCredit has also helped 14 first-time issuers access Nigeria's domestic debt capital market.
InfraCredit Chief Executive Officer Chinua Azubike said strengthening the company's institutional capacity has become a priority as its transaction pipeline grows and financing solutions evolve. The IFC investment reinforces that capacity and strengthens InfraCredit's ability to mobilise long-term domestic capital for infrastructure. Azubike added that InfraCredit has developed relationships with development finance institutions operating across different levels of its capital and risk-sharing structure.
The IFC financing is supported by the International Development Association Private Sector Window's Blended Finance Facility and the Concessional Capital Window. InfraCredit's guarantee model is designed to make qualifying infrastructure debt more attractive to long-term institutional investors, including pension funds, by reducing credit risk. Transactions guaranteed by InfraCredit have included Nigeria's first 15-year green infrastructure bond, while corporate bond tenors supported through its platform have extended to as long as 20 years.
The new IFC facility comes as InfraCredit expands beyond its core guarantee activities through additional financing structures intended to support infrastructure projects at different stages of development. The company has also broadened its domestic institutional shareholder base and transitioned to a public company listed on the NASD OTC Securities Exchange. For Nigeria, attracting domestic long-term capital into infrastructure remains crucial, as major projects typically require financing over periods longer than conventional commercial bank lending can readily provide.
Key points
- InfraCredit secures $50m IFC debt facility to expand infrastructure financing in Nigeria
- Facility to strengthen InfraCredit's capital structure and increase its capacity to support infrastructure transactions
- IFC investment aims to strengthen Nigeria's infrastructure financing ecosystem and mobilise long-term private capital
