Nigeria’s pension industry is moving to unlock a portion of its long-term savings for infrastructure investment through a proposed $750 million fund, as pension regulators and fund managers seek to channel institutional capital into projects across the country and selected African markets.

The Pension Industry Leadership Council (PILC) and FSD Africa, a U.K.-funded development agency, have signed a memorandum of understanding to develop the investment platform. FSD Africa will provide technical and advisory support, including helping establish the fund’s structure, select an investment manager and attract institutional investors.

Pension funds target infrastructure

The initiative was developed by Nigerian pension fund administrators with support from the National Pension Commission (PenCom) and FSD Africa. It has already attracted interest from 19 Nigerian pension funds, highlighting growing appetite within the industry to participate in infrastructure financing.

Under the agreement, FSD Africa will also help engage development finance institutions, strengthen institutional capacity and identify regulatory changes needed to establish the fund. The proposed platform is designed to bring together pension contributions and development finance capital to support infrastructure projects requiring long-term investment.

Omolola Oloworaran, PILC chair and PenCom director general, said the pension industry controls Nigeria’s largest pool of long-term savings and wants to deploy more of that capital toward infrastructure without compromising contributors’ retirement security.

“This MoU is the first step we are taking as an industry, and it is just the beginning,” Oloworaran said.

$350 million first close

The proposed fund is targeting an initial $350 million close in 2027 before expanding toward its full $750 million target. At full capacity, the platform aims to secure approximately $600 million from Nigerian pension funds and at least $150 million from development finance institutions.

An initial assessment of Nigeria’s infrastructure pipeline identified 39 projects with potential investment requirements of about $20 billion. The projects provide an initial pool of opportunities for the fund as it prepares to move from development and investor engagement toward deployment.

Mark Napier, CEO of FSD Africa, said the initiative seeks to address the mismatch between Africa’s substantial institutional savings and its persistent infrastructure financing deficit.

He said the agency was keen to work with PenCom and Nigeria’s pension industry to direct more of the capital managed by pension funds toward the country’s infrastructure priorities.

Nigeria takes majority share

The investment platform will allocate at least 60% of its portfolio to projects in Nigeria, with the remainder available for selected investments elsewhere in the region. Its investment strategy will focus on equity and quasi-equity, giving the fund exposure to infrastructure businesses and projects through ownership-based financing.

The proposed structure includes a naira-denominated core investment fund and a separate co-investment vehicle through which participating pension funds can invest alongside the main fund in selected projects. A parallel foreign-currency vehicle may also be established to accommodate international investors.

Institutional capital meets development

Established in 2012 and headquartered in Nairobi, Kenya, FSD Africa works across more than 30 African countries to strengthen financial markets and mobilize private investment. Its activities include supporting financial inclusion, green growth and economic resilience through market development and investment initiatives.

PILC, inaugurated by the Federal Government in September 2025, serves as a coordination and advisory body for Nigeria’s pension industry. It brings together regulators, pension fund administrators, custodians and other stakeholders to align the sector with national economic priorities.

The proposed infrastructure fund would give Nigeria’s pension industry a dedicated investment platform for participating in large-scale projects while providing infrastructure developers with access to longer-term domestic capital.