A qualified indigenous shipowner or group of shipowners can now get a maximum of $25 million (about N36.3 billion) credit facility from the Cabotage Vessels Financing Fund (CVFF) as the Nigerian Maritime Administration and Safety Agency (NIMASA) has set out new criteria for accessing the long-awaited controversial fund.
In a public notice titled: “Implementation and Disbursement of the Cabotage Vessel Financing Fund (CVFF): Requirements for Applicants,” issued by NIMASA on Wednesday, the agency said shortlisted shipowner must provide minimum equity contribution of 15% of the credit facility requested.
The marine notice signed by the Director-General of NIMASA, Dayo Mobereola stated that only Nigerian citizens and shipping companies fully owned by Nigerian Citizens shall be eligible to apply and benefit from the Fund.
The CVFF was established by the Coastal and Inland Shipping Act, 2003 with aim of empowering eligible local shipowners to acquire vessels for cabotage trade. However, since it’s establishment, local shipowners have not been able to access the fund, as it remained undisbursed by the custodian agency, NIMASA, despite decades of calling for its disbursement by maritime stakeholders. The CVFF was reported to hold $350 million (N525 billion) as at February, 2025.
The Federal Government recently gave indications of its commitment to disbursing the fund to help grow the local shipping industry when Mobereola led a team of NIMASA officials in a visit to the Minister of Finance and Coordinating Minister of the Economy, Wale Edun.
Edun emphasized that the CVFF disbursement remained a priority, as it is expected to have a positive ripple effect on the economy, drive growth, create employment opportunities, and strengthen Nigeria’s position as a major maritime hub in Africa.
In the marine notice calling for applications from indigenous shipowners for the CVFF, Mobereola stated: “Further to the Marine Notice PROC.11/24/SN01 issued by NIMASA on November 22, 2024 titled, ‘Implementation and Disbursement of the Cabotage Vessel Financing Fund (CVFF): Expression of Interest as a Primary Lending Institution’, on the process of disbursement of the CVFF.
“The CVFF is the Fund set up by the provisions of Section 42 of the Coastal and Inland Shipping (Cabotage) Act 2003 (the “Cabotage Act”) and administered by the provisions of the CVFF Guidelines 2006 (the “CVFF Guidelines”) to promote the development of indigenous ship acquisition capacity by providing financial assistance to Nigerian operators in domestic coastal shipping.
“In line with the provisions of the CVFF Guidelines, only Nigerian citizens and shipping companies wholly owned by Nigerian Citizens shall be eligible to apply and benefit from the Fund.
“To qualify for a loan or guarantee under the CVFF, an applicant shall, as a minimum, prepare a bankable feasibility report which shall be subject to independent verification by an approved Primary Lending Institution (PLI) and NIMASA; Provide the minimum equity contribution of fifteen percent (15%) of the credit facility request.
“In addition to the above requirements, Applicants should further note that each qualifying individual applicant or several applicants to the CVFF (whether related by management or ownership) can only be availed a credit facility not exceeding Twenty-Five Million United States Dollars (US$25,000,000.00) or its equivalent in an acceptable currency.”
The agency advised applicants to send their applications to a Primary Lending Institution (PLI), with payment of application fee and collateral as required by the PLI.
“Applications for credit facilities under the Fund shall be routed via a PLI and the applications shall be subjected to the specified Risk Acceptance Criteria and only qualifying applications shall be allowed access to the CVFF. As such, an applicant may be subject to further requirements as may be prescribed by a PLI and approved by NIMASA,” Mobereola said in the marine notice.
