NADF moves to unlock private capital for agriculture

The National Agricultural Development Fund (NADF) has launched a major push to attract private sector investment into Nigeria’s agricultural sector through a blended finance framework designed to de-risk agribusiness investments and unlock billions of naira currently sitting on the sidelines of the financial system.

The initiative was unveiled at a Blended Finance Workshop for Fund Managers in Lagos, organised by NADF in partnership with Convergence Blended Finance, a global network focused on mobilising private capital into emerging markets.

In his welcome remarks, the Executive Secretary and Chief Executive Officer of NADF, Mohammed A. Ibrahim, who was represented by the Fund’s General Manager for Partnerships and Investor Relations, Nasir Ingawa, said Nigeria’s agricultural transformation would require far more capital than government alone could provide.

“Agriculture is central to Nigeria’s food security, job creation, industrial growth, export potential and prosperity,” Ibrahim said. “Public capital alone cannot finance the transformation of Nigeria’s agricultural sector. Private capital alone will also not flow at the scale required unless the risks are better understood, better allocated and better managed.”

He explained that NADF is positioning itself as a catalyst within the agricultural finance ecosystem by connecting investors with credible agribusiness opportunities and helping to structure investments that can attract commercial funding.

According to him, the Fund is not seeking to compete with banks, asset managers or development finance institutions but rather to serve as a convener capable of bringing together capital providers, technical experts, guarantee institutions and agribusiness operators.

“Our role is not simply to fund projects. Our role is to facilitate, convene, curate credible and investable pipelines, and expose those opportunities to partners who have the capital, technical expertise and market discipline required to take them forward,” he said.

The workshop forms part of the newly established NADF Agribusiness Finance Lab, a platform created under the agency’s 2026 Action Plan to address persistent financing challenges within Nigeria’s agricultural sector.

According to the NADF boss, consultations with stakeholders in 2025 revealed that while significant pools of capital exist within the financial system, including development finance and concessional funding, deployment into agribusiness remains limited due to challenges surrounding risk assessment, investment structuring and alignment with agricultural value chains.

The Fund said the Finance Lab is intended to bridge these gaps by equipping fund managers with practical knowledge on blended finance and facilitating direct engagement with investment-ready agribusiness opportunities.

Also speaking at the event, the Head of Africa at Convergence Blended Finance, Aakif Merchant, said agriculture remains one of Nigeria’s most important economic sectors, accounting for between 30 and 35 per cent of employment, yet continues to struggle to attract sufficient private investment because of perceptions of high risk.

“What we’re here to talk about today is how do we mobilise capital that’s sitting on the sidelines in Nigerian pension funds, Nigerian insurance companies and even cross-border investors into the various SMEs so that we can enhance yields in Nigerian agriculture and create a larger base of employment,” Merchant said.

He noted that recent regulatory changes allowing pension funds to allocate up to 10 per cent of their portfolios to alternative investments present a significant opportunity to channel institutional capital into agriculture.

According to Merchant, blended finance offers a practical mechanism for mobilising such funds by combining development capital with private investment in a manner that reduces risk and improves the attractiveness of agricultural projects.

“Unfortunately, agriculture in Nigeria is perceived as a high-risk sector. We are here to talk about the use of blended finance as a financial structuring approach to de-risk investment and mobilise capital that is sitting on the sidelines into this sector for the benefit of the country,” he said.

Merchant explained that blended finance differs from impact investing and public-private partnerships because it focuses specifically on using catalytic funding from development partners, governments and philanthropic organisations to attract commercial investment into sectors that might otherwise struggle to secure financing.

He added that successful blended finance transactions are built around three key pillars: financial leverage, development impact and investor returns.

Beyond agriculture itself, Merchant argued that investors should view the sector through the broader lenses of climate resilience, food security, livelihoods, gender inclusion and economic development, noting that such an approach would unlock access to wider pools of impact-oriented capital.

“There are development outcomes around climate adaptation, employability, food security and gender. Framing agriculture within those broader Sustainable Development Goals can attract more capital than focusing solely on agriculture,” he said.

He also identified currency volatility, transaction costs and lack of scale as major concerns for investors, stressing the need to aggregate viable investment opportunities and strengthen export-oriented and import-substitution value chains.

Using palm oil and fish production as examples, Merchant said Nigeria has substantial opportunities to reduce imports while creating jobs and preserving foreign exchange.

“We heard that Nigeria imports significant volumes of palm oil even though palm oil originated from this region. The same applies to fish despite having an extensive coastline. Import substitution remains a significant opportunity,” he said.

The workshop brought together fund managers, banks, development finance institutions, guarantee providers and agribusiness stakeholders to examine practical approaches for structuring agricultural investments, allocating risks and deploying concessional capital.

Participants engaged in sessions covering blended finance fundamentals, global case studies, risk-sharing mechanisms and practical exercises built around real agribusiness opportunities identified by NADF.

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The agency disclosed that it has already begun assembling a pipeline of investment-ready agribusinesses requiring financing and hopes the platform will help move projects from the proposal stage to bankability and eventually to capital deployment.

Ibrahim said the long-term goal is to establish a structured marketplace where capital providers, agribusiness operators, technical experts and risk-sharing institutions can collaborate more effectively.

Through the Agribusiness Finance Lab, NADF hopes to strengthen the capacity of fund managers, improve the alignment between available capital and investment opportunities, and position itself as a leading ecosystem convener in Nigeria’s agricultural finance landscape.

Stakeholders expressed optimism that stronger collaboration among public institutions, development partners and private investors could unlock significant new funding for the sector, helping to boost food production, create jobs and accelerate economic growth.

For NADF, the success of the initiative will ultimately be measured by its ability to convert investor interest into actual transactions and attract long-term private capital into Nigeria’s agricultural value chains.