The Ministry of Finance Incorporated (MOFI) and other stakeholders are partnering to provide N10 billion credit to Nigerians for Compressed Natural Gas(CNG) conversions.
The stakeholders are Nigerian Consumer Credit Corporation (CREDICORP) and the Presidential Initiative on Compressed Natural Gas (Pi-CNG)
During the agreement signing on Wednesday in Abuja, the partners announced the N10 billion Credit Access for Light and Mobility (CALM) Fund, designed to address the increasing financial pressures faced by Nigerians amid rising energy and transportation expenses.
The News Agency of Nigeria (NAN) reports that the Pi-CNG and CREDICORP are among the portfolios companies under MOFI, an investment and assets management establishment of the Federal Government.
The new fund will enable Nigerians to obtain loans for CNG conversions kits and energy-saving solutions through Participating Financial Institutions (PFIs), providing a pathway to sustainable energy without the financial burden of upfront costs.
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Speaking, Mr Uzoma Nwagba, Managing Director/Chief Executive Officer, CREDICORP, said MOFI would aggregate and expand the consortium fund, collaborating with private and institutional investors to grow initial N10 billion fund.
Nwagba explained that the CREDICORP would act as Fund Manager; using its expertise in consumer credit to manage loan disbursements and offer credit guarantees.
“We are setting aside a fund that will allow Nigerians specifically access credits to convert their vehicles to CNG with one to three years repayment duration.
“CREDICORP will seed the CALM Fund with N2.5 billion, ensuring that Nigerians can access affordable financing at 15 to 20 per cent per cent interest rate, through Participating Financial Institutions (PFIs).
“People are charged different interest rates depending on their institutions and credit worthiness, financial behavior, earnings and diligence with paying back previously,” he said.
He said the Pi-CNG Ltd. would serve as a service provider, facilitating the conversion of vehicles to CNG through authorised centers and offering discounted conversion packages for consumers using CALM loans.
Sir Michael Oluwagbemi, Chief Executive Officer, Pi-CNG, said the need for Nigerians to be mobile and enjoy affordable, eco-friendly fuel and reliable transportation made President Bola Tinubu to introduce the Pi-CNG programme.
Oluwagbemi said to achieve this for a vast majority of consumers, the president initiated the launch of the conversion incentive programme for the commercial sector.
“The Consumer Credit Corporation is partnering with us to launch this access for private individuals to access consumer credits to afford the cost of conversion, to enjoy the low cost of CNG and the access it gives for transportation.
“This scheme has the tendency to attract the investment that will enable these conversion kits to be manufactured domestically; another programme is being coordinated with MOFI, on domestic manufacturing capacity for the CNG sector,’’ he said.
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The Pi-CNG boss explained that the development would enable civil servants or workers in the organised private sector whom their salaries/income could be tracked and verified by a financial institution to benefit from the fund.
He said it would naturally translate into other sectors of the economy, because the civil servants and organised private sector workers could leverage their vehicle at low cost for the economic benefit.
Earlier, Dr Armstrong Takang, Managing Director/Chief Executive Officer, MOFI, said the fund would address the unintended consequences arising from oil subsidy reforms.
He noted that one of the unforeseen outcomes was the surge in transportation costs over the past few months, which has posed significant challenges for many families struggling to get around.
“Through flexible financing options, Nigerians will be able to obtain immediate credit to convert their vehicles to CNG and adopt solar energy solutions—reducing dependency on expensive fuels and lowering electricity bills,” he said.
Nigerians are encouraged to explore this opportunity by applying for CALM Fund loans through participating financial institutions (www.credicorp.ng/apply) while specific CNG conversion centres will market the options to consumers.
(NAN)
