InfraCredit: Unlocking Domestic Capital for Nigeria’s Infrastructure Future
In this episode of Uxolo: In-Depth With, Jessica Brown speaks with Chinua Azubike, CEO of InfraCredit, about how credit enhancement, local currency financing and institutional capital are transforming infrastructure investment across Nigeria.
InfraCredit
InfraCredit is a specialised credit enhancement institution that provides local currency guarantees to infrastructure projects, enabling long-term financing from domestic institutional investors such as pension funds and insurance companies.
Established to address one of Africa's biggest financing challenges, the mismatch between foreign currency borrowing and local currency revenues, InfraCredit helps build sustainable infrastructure financing markets while reducing reliance on international capital.
InfraCredit focuses on:
- Unlocking domestic pension and insurance capital
- Mobilising long-term local currency financing
- Matching infrastructure assets with long-term investors
- Reducing dependence on foreign currency debt
With an estimated $1.5–2 trillion in domestic institutional savings across Africa, only a small proportion has so far been invested in infrastructure.
Solving the Currency Mismatch
Infrastructure users pay for electricity, transport and water in local currency.
Historically, many developers borrowed in US dollars, creating significant exchange rate risk.
InfraCredit addresses this by:
- Providing local currency guarantees
- Enabling local currency bond issuance
- Reducing refinancing risk
- Creating more sustainable financing structures
The result is infrastructure that is financially resilient and more affordable for end users.
Building Confidence in Infrastructure Debt Markets
Since launching in 2017, InfraCredit has helped reshape Nigeria's debt capital market.
Key achievements include:
- Extending financing tenors from 5–7 years to 10, 15 and 20 years
- Supporting approximately $500 million in infrastructure debt transactions
- Lowering financing costs through enhanced credit quality
- Improving market price discovery for infrastructure risk
As markets mature, repeat issuers increasingly return without requiring guarantees—demonstrating growing investor confidence.
Guarantees as a Market Catalyst
InfraCredit views guarantees as temporary market-building tools rather than permanent subsidies.
Its guarantees help:
- Bridge information asymmetry
- Enable first-time issuers to access capital markets
- Build investor confidence in new infrastructure sectors
- Crowd in private institutional investment
The objective is not to support weak projects, but to accelerate financing for commercially viable infrastructure with predictable cash flows.
Strengthening Domestic Capital Markets
InfraCredit's own evolution reflects the growing maturity of Nigeria's financial markets.
Recent milestones include:
- 42% of InfraCredits equity is now held by domestic institutional investors
- Successful secondary sale enabling local investor participation
- Development of a dedicated regulatory framework for debt guarantee institutions
- Increased institutional ownership of infrastructure finance
The model demonstrates how development finance can transition towards local market ownership over time.
Blended Finance as a Catalyst
Development finance institutions have played an essential role in helping new markets develop.
Blended finance has supported:
- Technical assistance
- First-loss capital
- Research and market development
- De-risking emerging sectors such as distributed renewable energy
This catalytic capital enables significantly larger pools of domestic private investment to participate.
Replicating the Model Across Africa
Having demonstrated success in Nigeria, InfraCredit is now looking beyond a single market.
Future priorities include:
- Replicating the guarantee model in countries such as Ghana
- Expanding local capital market participation
- Building regional knowledge and institutional capacity
- Creating scalable financing ecosystems across Africa
The ambition is to establish domestic capital as the primary source of long-term infrastructure finance across the continent.
Episode takeaway
Africa's infrastructure challenge is not simply about attracting more international capital. It is about unlocking the capital already available within African economies.
InfraCredit demonstrates that when infrastructure is:
- Financed in local currency
- Supported by credit enhancement
- Backed by domestic institutional investors
- Built on strong regulatory frameworks
...local capital markets can become a powerful engine for infrastructure development.
The future of African infrastructure finance lies not only in raising more capital, but in building the institutions, confidence and financial architecture that allow domestic savings to finance domestic growth.
