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Credit Enhancement Facilities

PIDG credit enhancement facilities mobilise local capital into projects and businesses, removing obstacles for domestic investors and lenders.

Addressing the infrastructure financing gap requires long-term local currency debt financing. In many of the market that PIDG operates, this type of financing is scarce or unavailable. PIDG’s Credit Enhancement Facilities (CEFs) address this issue by offering high-quality local currency credit guarantees to mobilise existing sources of domestic capital into infrastructure. In doing so, we help match the local providers and users of long-term local currency to create an entirely onshore infrastructure financing solution.  

Guarantees provided by CEFs can be issued for tenors up to 20 years, supporting the development of long-term local debt instruments. Guaranteed debt is expected to be locally rated AAA, benefiting from a CEF’s strong credit profile.  

Working together

PIDG supports the conception, development and incubation of CEFs by acting as the developer for the business, namely:
  • identifying attractive potential markets through feasibility assessment 
  • developing business plans  
  • fundraising 
  • committing development capital and providing anchor equity investment and callable capital funding 
  • providing technical assistance support 
  • engaging with governments and regulators to facililate the creation of these new entities  
  • taking board seats to help guide the strategy of the newly launched ventures 
  • supporting CEF businesses once they are in operation 

PIDG is the global leader in local currency credit guarantees for infrastructure, with a track record that started in 2005 with the development of GuarantCo. We have since sponsored Credit Enhancement Facilities in three countries: InfraCredit Nigeria, InfraZamin Pakistan, and Dhamana (Kenya), while also partnering with established onshore guarantors like the Credit Guarantee Corporation of Cambodia. 

This extensive experience, along with our investment expertise across Africa and Asia in infrastructure and corporate transactions — encompassing project development, fundraising, credit underwriting, sustainable development impact, and HSES assessments — means we are uniquely positioned to promote local market development through the establishment of CEFs.  

Ways co-investors can participate in a CEF
  • Concessional equity (to help mobilise private sector equity into the facility) 
  • Equity  
  • Sub/senior debt 
  • Callable capital  
  • Programmatic re-guarantee structures 

CEFs established by PIDG

InfraCredit Nigeria was established in 2018 and closed its first guarantee transaction in 2019. Since that time it has closed 37 transactions with a total portfolio size of NGN 222.3b (~USD 146m). InfraCredit has supported projects in the logistics, transportation and on-grid power sectors.

InfraZamin Pakistan was established in 2021 and closed its first guarantee transaction in 2022. Since that time, it has closed 5 transactions with a total portfolio size of PKR 6,916Mn (~USD 24.7Mn). InfraZamin Pakistan has supported multiple infrastructure projects in sectors like Digital Communications and Infrastructure, Renewable Energy, Agri-Infrastructure, and Social Infrastructure.

Dhamana Guarantee Company was established in late 2024 and started operations in January 2025.

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