FG Partners Banks To Finance CNG Kits, Targets Lower Transport Costs

AYOMIDE TIWATAYO, Lagos

The federal government through the Presidential Initiative on Compressed Natural Gas and Electric Vehicles (Pi-CNG & EVs) has launched a financing partnership to make CNG vehicle conversion kits more affordable, aiming to reduce transport costs amid rising energy prices.

The agency signed Memorandum of Understanding (MoU) with the Nigerian Consumer Credit Corporation (CREDICORP), Moniepoint Microfinance Bank Limited (Moniepoint MFB), and National Credit Guarantee Company Limited (NCGC) and Pi-CNG & EV.

Speaking at the signing in Abuja on Wednesday, the executive chairman, Pi-CNG & EV, Ismaeel Ahmed, said that the partnership was designed to ease CNG adoption by reducing upfront installation costs.
“Financing generally gives flexibility. That is what this partnership will do,” he said.

The commission noted that the partnership, which kicked off the next phase of Nigeria’s clean mobility rollout, responds to financial strain on Nigerians from high energy and transportation costs.

According to him, the new fund, repaid with interest of nine to 20 per cent, provides credit for CNG conversion kits over six months.

Ahmed explained: “The financing arrangement will allow users to repay installation costs over agreed periods. For example, if the cost of installation and the kit is N100,000, instead of paying upfront, users pay over six months. Commercial operators using tricycles or other transport save on fuel and maintenance.”

He added that operators switching to CNG see fuel costs drop by 60 to 70 per cent, with a typical operator spending N40,000 weekly on fuel and N10,000 on maintenance reducing to N10,000 monthly on maintenance, saving up to N30,000.

On rollout, Ahmed said about 100,000 vehicles are targeted initially, with potential expansion.

The managing director and CEO of CREDICORP, Uzoma Nwagba, said the collaboration supports the federal government’s efforts to address impacts of policy changes like exchange rate unification and fuel subsidy removal, targeting low- and middle-income citizens. Once converted, fuel costs can drop by 75 per cent, such as from N80,000 to N20,000 weekly.

CREDICORP enables financial institutions to offer consumer credit at rates as low as nine per cent, with higher-risk borrowers at 20 to 24 per cent, backed by credit guarantees from NCGC.

On his part, head of Loans at Moniepoint, Tobi Amira,noted the collaboration addresses access to affordable financing for CNG conversions.

Also, the head of Commercial at Pi-CNGI, Tosin Coker, said the partnership enables CNG infrastructure use across states, financing access, and affordability at scale.