THE World Bank has approved up to $12 million in loan funding for Nigerian states hosting internally displaced persons (IDP) camps under a new federal initiative aimed at addressing data gaps linked to displacement-related vulnerabilities.
The funding falls under the Solutions for the Internally Displaced and Host Communities Project, approved on August 7, 2025, and is tied to Performance-Based Condition Two, which focuses on improving the quality and availability of data on displaced persons.
Access to the funds is conditional, with disbursements linked strictly to independently verified results.
Under the arrangement, participating states will only receive payments after meeting specific data, governance, and integration benchmarks.
States that successfully register and profile IDPs living in host communities will receive funding spread over three years, with requirements increasing annually.
The $12 million allocation forms part of a broader $300 million concessional credit approved by the International Development Association (IDA) and signed between the Federal Government of Nigeria and the World Bank.
Each disbursement represents 2.5 per cent of the principal amount, repayable over 20 years in US dollars, with repayments deferred for several years and interest charged at a variable rate within agreed limits.
In the first year of implementation, eligible Tier 1 and Tier 2 states are required to commence IDP registration and profiling in selected host communities and complete comprehensive demographic and vulnerability assessments in at least two wards.
States that meet this threshold will receive $250,000 each.
By the second year, Tier 1 states must carry out intention surveys and stability index assessments in areas earmarked for local integration, alongside detailed analyses of the drivers and socioeconomic impacts of displacement.
Completion of these requirements will qualify each Tier 1 state for an additional $500,000.
The largest payout comes in the third year, when states must ensure that at least 80 per cent of IDPs in host communities are registered and profiled.
States that meet this benchmark will receive another $500,000, bringing total disbursements under the performance condition to $12 million.
Beyond IDP data collection, the financing agreement outlines two other performance-based conditions. One focuses on improving asset management at the local government level, with up to $9 million allocated for verified reforms.
The other targets the long-term integration of IDPs into development processes, including access to civil documentation, land ownership, livelihood programmes, and conflict management mechanisms, with up to $12 million available across multiple milestones.
Participation is limited to states that meet strict eligibility criteria.
Tier 1 states must have more than 150,000 IDPs representing over two per cent of their population, while Tier 2 states must host at least 100,000 IDPs or have an IDP population exceeding one per cent.
Loan repayments are scheduled to begin on January 15, 2031, and will run semi-annually until July 15, 2050.
The World Bank remains Nigeria’s largest external creditor, accounting for over 41 per cent of the country’s total external debt, reinforcing its central role in financing Nigeria’s development and humanitarian interventions.