The International Finance Corporation (IFC), a member of the World Bank Group, has signed an agreement with the Central Bank of Nigeria (CBN) to enhance local currency financing, supporting the growth and success of private businesses in Nigeria.
According to a statement from the CBN on Monday, this partnership will enable the IFC to manage currency risks more effectively and expand its investments in the Nigerian naira, targeting critical economic sectors such as agriculture, housing, infrastructure, energy, small and medium enterprises, and the creative and youth economy.
The IFC plans to significantly increase its financing in these vital areas in Nigeria, with ambitions to invest over $1 billion in the coming years. Many of these sectors rely on local currency financing, making the IFC’s collaboration with the CBN crucial for expanding access to funding.
“This pioneering initiative between the IFC and CBN will unlock much-needed long-term local currency financing for private businesses in Nigeria at economically viable rates,” said the Governor of the CBN, Yemi Cardoso.
“This collaboration marks significant progress in the CBN’s commitment to delivering innovative development initiatives through reputable third-party service providers, moving beyond traditional intervention programmes. It will act as a catalyst for economic growth and support the Federal Government’s agenda for economic diversification.”
Expanding access to inexpensive local currency finance for small firms in Nigeria is critical for the IFC to meet the rising demand for diverse funding choices and better manage currency risk, according to IFC Managing Director Makhtar Diop.
“Our collaboration with the Central Bank of Nigeria will increase lending in Nigerian naira, promoting economic growth and job creation across the country.
“With an active portfolio of investments in Nigeria totalling $2.13 billion—the second largest in Africa—local currency financing is a top priority for the IFC.
“The IFC will continue to leverage innovative financial instruments and strengthen partnerships to meet the growing demand for more local currency financing in emerging markets,” according to Diop.
