Nigeria Targets $750m Pension Fund, Eyes $350m First Close In 2027

Nigeria is focusing on a $750m pension-backed infrastructure funding fund to mobilise long-term home capital for vital initiatives within the power, transportation and digital infrastructure sectors, following a partnership between the Pension Industry Leadership Council (PILC) and UK-funded growth company, FSD Africa.

The proposed funding platform has already attracted curiosity from 19 Nigerian pension funds and is anticipated to mobilise an preliminary $350m at its first shut in 2027 earlier than scaling as much as its final goal of $750m.

Under the proposed funding construction, Nigerian pension funds are anticipated to contribute roughly $600m, whereas growth finance establishments (DFIs) will present a minimum of $150m.

The initiative is aimed toward addressing Nigeria’s infrastructure financing deficit by connecting investment-ready initiatives with long-term institutional capital, whereas creating further funding alternatives for pension funds.

The partnership was formalised by a Memorandum of Understanding (MoU) signed by PILC and FSD Africa in Lagos on November 10, 2026.

Under the settlement, FSD Africa will present technical help and advisory assist to PILC to facilitate the institution of the fund. Its duties will embrace supporting the number of a fund supervisor by a aggressive course of, participating potential buyers and growth finance establishments, strengthening institutional capability and helping with mandatory regulatory reforms.

The initiative is being developed by Nigerian Pension Fund Administrators (PFAs), with assist from the National Pension Commission (PenCom) and FSD Africa.

The proposed platform is anticipated to offer a structured funding channel by which pension property will be deployed into infrastructure initiatives able to producing long-term returns whereas contributing to financial growth.

Speaking on the initiative, the UK Deputy High Commissioner in Lagos, Jonny Baxter, mentioned the partnership mirrored the shared dedication of Nigeria and the United Kingdom to mobilising home institutional capital for productive investments.

He famous that attracting pension funds and different home buyers into the true economic system remained an necessary precedence for each international locations.

Baxter mentioned the proposed fund represented concrete progress in direction of changing long-term funding ambitions into infrastructure growth, employment alternatives and financial progress.

The Chair of PILC and Director-General of PenCom, Omolola Oloworaran, described the initiative as well timed, noting that Nigeria’s pension business managed the nation’s largest pool of long-term financial savings capital.

She mentioned the business was dedicated to deploying a portion of those sources to assist infrastructure growth whereas making certain that the retirement financial savings of pension contributors remained protected.

According to her, the MoU represents step one in direction of establishing a platform that may allow pension funds to take part extra actively in financing vital infrastructure.

Oloworaran added that the initiative would create alternatives for the pension business to contribute extra meaningfully to the nation’s financial growth by long-term investments.

Similarly, the Chief Executive Officer of FSD Africa, Mark Napier, mentioned the proposed fund would assist tackle the contradiction between Africa’s substantial institutional funding capital and its persistent infrastructure financing gaps.

He famous that the continent continued to face important infrastructure funding challenges regardless of the supply of long-term capital managed by institutional buyers.

Napier mentioned FSD Africa was dedicated to working with PenCom and Nigeria’s pension business to unlock extra of the capital underneath their administration for funding in precedence infrastructure initiatives.

An preliminary evaluation of Nigeria’s infrastructure funding pipeline has recognized 39 initiatives with potential relevance to the proposed platform, representing roughly US$20 billion in funding necessities.

The initiatives reduce throughout vital infrastructure segments, together with power, transportation and digital connectivity, that are thought-about important to enhancing financial productiveness, strengthening enterprise competitiveness and increasing entry to important companies.

Under the proposed funding association, a minimum of 60 per cent of the fund’s portfolio might be allotted to initiatives in Nigeria, whereas the remaining portion might be accessible for chosen infrastructure investments throughout different regional markets.

The funding platform is anticipated to deploy capital by fairness and quasi-equity devices, offering long-term financing for initiatives whereas providing collaborating pension funds entry to professionally managed infrastructure investments.

The proposed construction will comprise a naira-denominated core funding fund and a separate co-investment automobile that can permit collaborating pension funds to take a position alongside the principle fund in chosen initiatives.

A parallel foreign-currency funding automobile might also be established to accommodate worldwide buyers and broaden the platform’s funding base.

The initiative comes amid growing efforts to mobilise home institutional financial savings to deal with Nigeria’s infrastructure financing necessities and cut back dependence on public sector funding and exterior borrowing.