The World Bank has clarified that its planned $10.50 million financing to the Central Bank of Nigeria (CBN) is a grant, not a loan.
This clarification comes after earlier reports suggested that Nigeria had sought a $10.50 million loan to enhance the CBN’s technical capacity and modernize the country’s domestic payment infrastructure.
According to a source at the World Bank, who spoke on condition of anonymity with Punch, the $10.50 million is being provided under the Finance for Development Multi-Donor Trust Fund as part of a collaborative effort between the World Bank and the CBN.
“It is not a loan, but a grant,” the source emphasized on Friday. This information was further confirmed by Punch’s independent checks, which revealed that the amount is designated as a grant to support the project, not a loan.
The World Bank’s official website initially described the CBN as a borrower for the project, leading to confusion about the nature of the financing.
However, with clarification from the World Bank source, it is now clear that the $10.50 million is aimed at supporting the CBN’s capacity-building efforts, particularly to integrate innovative technologies into its supervisory framework.
The financing is part of a broader partnership to help the CBN enhance its technology-driven, data-based supervision and modernize Nigeria’s domestic payment infrastructure.
This includes a focus on improving remittance flows and addressing challenges within Nigeria’s rapidly evolving financial landscape.
The project is still in its early stages, with the CBN’s Technical Assistance Facility currently at the concept review stage.
According to the World Bank, the initiative will support the integration of advanced technological solutions to strengthen the CBN’s supervisory capabilities and modernize the domestic payment systems.
The project is expected to ensure the safety and reliability of remittance flows, with a particular emphasis on enhancing institutional capacity within the CBN.
The $10.50 million grant, which is not linked to the World Bank’s International Development Association (IDA) or the International Bank for Reconstruction and Development (IBRD), is scheduled for board presentation approval on June 12, 2025.
The CBN will serve as the implementing agency for the project, working closely with the World Bank to ensure its successful execution.
This partnership aims to equip the CBN with the tools needed to tackle emerging and long-standing challenges in Nigeria’s financial sector.