InfraCredit Nigeria

It has been estimated that, over the next 30 years, Nigeria will require over USD 3 trillion of investment if the country is to overcome its existing infrastructure gap. Long-term patient capital is key to progressing infrastructure projects, however, accessing such funds in Nigeria can be challenging. Companies struggle to issue bonds on Nigeria’s capital markets which meet with the high credit rating requirements of investors such as pension funds and insurers. These institutional investors are largely unfamiliar with the infrastructure asset class having concentrated their investments to date in federal government securities. 

In a bid to enable pension funds and insurance companies to diversify their portfolios and to unlock finance for vital infrastructure development, PIDG worked with the Nigerian Sovereign Investment Authority (NSIA) to establish the first of its kind Nigerian Infrastructure Credit Enhancement Facility (InfraCredit). Established in 2017 with an initial USD25m of contingent capital from PIDG’s guarantee solution, GuarantCo, InfraCredit is a specialised institution that provides Naira-denominated guarantees to enhance the credit quality of local currency debt instruments issued to finance infrastructure projects in Nigeria. InfraCredit was the first local currency guarantee facility in the world targeting infrastructure in frontier markets. 

In 2020, PIDG’s project development solution, InfraCo, made an equity investment designed to support InfraCredit’s AAA credit rating and strengthen its guarantee capacity, increasing its ability to attract long term local currency finance for bankable infrastructure projects in Nigeria. 

InfraCredit’s guarantees enable infrastructure companies to issue bonds by providing a ‘credit wrap’ that secures timely repayment of principal and interest to investors, acting as a catalyst to mobilise investment from long-term private investors with exclusive appetite for investment grade bonds. The credit enhancement offered by an InfraCredit guarantee lowers the perceived investment risk which, from an issuer’s perspective, reduces the cost of securing long-term local currency debt, making infrastructure projects more bankable. 

InfraCo exited in late 2025, recycling its funds into new projects.