After 23 years, $700m shippers’ fund portal rises from the dead

…To end vessel financing freeze 

After 23 years of inactivity, Nigeria’s $700 million Cabotage Vessel Financing Fund (CVFF) has finally been reactivated, raising hopes of ending the long-standing freeze on vessel financing for indigenous shipowners.

The fund, created under the Coastal and Inland Shipping (Cabotage) Act of 2003 to unlock structured, long-term financing for Nigerian-owned vessels, had accumulated contributions over the years but was never fully operationalised. As a result, local operators remained shut out, relying heavily on foreign financing and foreign-flagged vessels.

But on Thursday, Adegboyega Oyetola, minister of Marine and Blue Economy, launched the CVFF application portal in Lagos, activating the first concrete mechanism through which Nigerian shipping companies can apply for funding under the Cabotage Act.

The portal, which will be managed by Nigerian Maritime Administration and Safety Agency (NIMASA), allows eligible Nigerian shipowners to submit applications digitally.

Applications will be evaluated through approved primary lending institutions, which will handle due diligence, credit assessment and loan administration.

Officials say the portal is designed to address longstanding concerns about transparency and governance that stalled previous disbursement efforts. The process will be fully digital, with defined eligibility criteria and monitoring mechanisms built into the system.

According to Oyetola, the fund is structured as a revolving facility, meaning beneficiaries are expected to repay loans to sustain future lending. The aim is to reduce foreign dominance in the country’s shipping industry.

“We hope to reduce reliance on foreign-flagged vessels in our coastal trade, improve retention of value within the domestic economy, create employment opportunities for Nigerian seafarers and stimulate growth in allied sectors such a shipbuilding, ship repair and maritime services,” he said.

Dayo Mobereola, director-general of NIMASA, said the agency has created a dedicated CVFF unit to manage applications, while liaising with lenders and overseeing compliance. He said the focus would be on risk management, professional oversight and strict adherence to eligibility rules.

Lawmakers from the Senate and House of Representatives committees on marine transport and maritime safety said they would back the implementation through legislative oversight, while industry representatives said access to predictable, long-term financing remains critical for vessel acquisition, fleet renewal and competitiveness, particularly as Nigerian operators face higher borrowing costs than their foreign counterparts.

In 2025, Oyetola instructed NIMASA to begin preparations for CVFF disbursement, assuring the industry of disbursement in August. However, execution stalled as shipowners remained locked out till the end of the year.

Under the framework, eligible firms may access financing of up to $25 million each to acquire vessels that meet international safety and performance standards, with lending handled through vetted financial institutions.

Bashir Jamoh,  former DG, had, in 2024, stated that NIMASA could not start disbursing the money in the Cabotage Fund without first engaging with banks and shipowners.

NIMASA appointed 12 Primary Lending Institutions (PLIs) to administer the funds, seven more than the five former President Buhari approved in 2023, including Polaris, Zenith, Union and Jaiz banks, plus the UBA.

Mobereola said the banks will lend 35 percent while NIMASA will lend the other 50 percent. The beneficiary of the fund will provide the remaining 15 percent equity shares.(BusinessDay)