The Nigerian government has ordered the disbursement of the Cabotage Vessel Financing Fund to qualified indigenous shipowners in Lagos, aiming to boost local fleet capacity. However, maritime experts warn that strict primary lending conditions and regulatory hurdles continue to stall vessel acquisitions across the sector.
Nigeria’s maritime sector stands at a persistent crossroads between policy promises and commercial reality. Federal officials announced that the distribution of the long-awaited Cabotage Vessel Financing Fund (CVFF) is finally underway. This announcement came at the annual summit of the Shipping Correspondents Association of Nigeria held on October 29, 2026, at Rockview Hotels in Apapa, Lagos. The fund is believed to be about $360 million or estimated at up to $700 million. It is designed to empower domestic operators who currently control only four to five per cent of the carriage of Nigerian imports and exports.
Industry leaders and legal authorities at the SCAN summit argued that structural bottlenecks and stringent bank requirements threaten to render the financial lifeline out of reach for most local operators, despite the Federal Government beginning disbursement.
Ministerial Directives Guide Fund Payouts
Minister of Marine and Blue Economy Adegboyega Oyetola told attendees that the administration remains fully committed to expanding domestic shipping capacity. He was represented by the ministry’s Director of Press and Public Relations, Mrs Anastasia Ogbonna. The minister stated that NIMASA had been directed to commence payouts. NIMASA was also directed to launch a dedicated application portal in January 2026 to ensure transparency. Furthermore, the agency must expand the roster of approved Primary Lending Institutions from five to 12.
The CVFF derives from a two per cent surcharge on contracts carried out in Nigerian coastal trade under the Coastal and Inland Shipping Act of 2003. Previous attempts to distribute the money have repeatedly stalled. By April 2025, NIMASA announced new plans for a $700 million fund, leading directly to the current rollout.
Nigeria’s maritime sector needs more Nigerian owned ships not just more shipping activity.On 17 October 2026, Hon Minister, Marine and Blue Economy Adegboyega Oyetola directed NIMASA to accelerate the Cabotage Vessel Financing Fund (CVFF) disbursement to qualified shipowners.…
High Collateral Demands Stymie Shipowners
Primary lending institutions have introduced commercial hurdles that clash with the realities of local shipowners, even with the portal open. Banks are demanding that applicants secure cargo contracts before any loan application can be considered. Many indigenous owners operate older vessels on bareboat charter or through third-party subcontracting. Satisfying direct requirements remains exceptionally difficult, particularly given strict vessel age limits enforced offshore.
Dr Olisa Agbakoba delivered the keynote address. He argued that regulatory uncertainties and stringent banking conditions significantly increase investment costs, severely discouraging long-term financial commitments. He noted that fleet development cannot rely entirely on public financing, calling instead for risk-shared commercial partnerships.
Omatseye Criticises Lending Guidelines
Dr Temisan Omatseye delivered a sharp appraisal of the fund’s architecture. The former NIMASA Director-General called for the complete scrapping of existing guidelines dating back to 2003. Participating banks act as custodians under the current structure while managing credit risks for indigenous shipowners acquiring vessels.
Omatseye pointed out a fundamental contradiction under current financial laws. Commercial banks are expected to take substantial financial exposure while being restricted by mandated lending directions.
On January 22, 2026, the Federal Government of Nigeria, through NIMASA, officially launched the Cabotage Vessel Financing Fund (CVFF) application portal. The fund is designed to provide low-interest financial support to indigenous Nigerian shipowners for vessel acquisition.… pic.twitter.com/Bk2ZZ59d6o
Now, we have what we call the Banks and Other Financial Institutions Act (BOFIA) 2020, which gives the power of risk assessments to the bank. So you cannot tell me that I am contributing 35%, but I’m taking 100% of the risk. But you are telling me I must give the money to certain persons, already in itself there is a conflict.
Dr. Temisan Omatseye, Former Director-General of NIMASA, via Nigeria Maritime News
NIMASA disclosed that out of 92 applications received for the facility, only 20 were forwarded to primary lending institutions. Just a single application reached the final approval stage.
Banks Affirm Maritime Sector Support
United Bank for Africa Apapa Regional Manager Nelson Edoye addressed the summit delegates. Representing Group Managing Director Oliver Alawuba, Edoye affirmed the institution’s commitment to supporting indigenous maritime participation. Edoye acknowledged the capital-intensive nature of shipping, noting that an LNG carrier alone can cost about $250 million with repayment stretching over 15 years. He emphasized the need for tailored, de-risked financing structures.
The Federal Government has unlocked the Cabotage Vessel Financing Fund (CVFF) to help Nigerian shipowners grow their businesses.The Minister of Marine and Blue Economy, @GboyegaOyetola said the fund will provide loans of up to $25 million at low interest rates for qualified… pic.twitter.com/BibWJDAKwj
SCAN President Moses Ebosele concluded that overcoming these hurdles requires a comprehensive strategy combining port efficiency, harmonised charges, and public-private partnerships to establish a commercially driven national shipping line capable of retaining maritime revenue within Nigeria.
FG moves to unlock $25m CVFF loans for Nigerian shipownersThe Federal Government has moved to unlock the Cabotage Vessel Financing Fund (CVFF) after more than 20 years, with qualified Nigerian shipowners eligible to access up to $25 million to acquire vessels. The initiative… pic.twitter.com/504WucAPnY
