The Managing Director and Chief Executive Officer of Fidelity Bank Plc, Nneka Onyeali-Ikpe, has issued a strong appeal to the Federal Government. She is calling for the establishment of specialised funding mechanisms to address a massive financial shortfall exceeding $25 billion that is crippling the growth of Nigeria's aviation industry.
High Cost of Aircraft and Unsustainable Loans
Onyeali-Ikpe delivered this critical message during a session at the Nigeria International Air Show, held at the Nnamdi Azikiwe International Airport in Abuja. She pointed out that the current commercial lending rates, which are linked to the high Monetary Policy Rate (MPR), are simply unworkable for airlines. These carriers depend heavily on loans to purchase aircraft and maintain daily operations.
She proposed a concrete solution: "We have been advocating that an aviation fund should be initiated from the Cash Reserve Ratio (CRR). We have requested that funding for airlines come out of the CRR," the bank CEO stated. She emphasised that aviation is an essential sector that deserves access to special interest rates and customised financing structures. This support is vital for fleet acquisition, maintenance, and critical infrastructure upgrades.
The Fidelity Bank chief highlighted the staggering cost of modern aircraft, which can reach up to $80 million per unit. This high capital requirement makes it nearly impossible for operators to survive and expand without deliberate government intervention.
Restored Confidence and a Successful Test Case
Onyeali-Ikpe explained that her bank's renewed commitment to financing aviation followed a successful partnership with Air Peace. She described the airline as the bank's "test case." The financial discipline, strong corporate governance, and resilience demonstrated by Air Peace helped rebuild lender confidence. This was crucial after previous industry collapses had severely reduced the appetite for aviation loans among financial institutions.
"Today, we can support at least 500 airlines fully, and 10 through their vendors, because our test case succeeded," she revealed, underscoring the positive ripple effect of a single successful partnership.
The Continental Challenge and Path Forward
The CEO outlined the broader economic significance of aviation in Nigeria, which currently supports 86 domestic flights, 216,000 jobs, and serves over 16 million passengers. "There's no way we can allow the industry to die," she asserted.
She expanded the view to the entire African continent, noting that airlines face an enormous financing deficit. The need for fleet renewal, maintenance repair and overhaul (MRO) facilities, airport upgrades, and digital infrastructure is estimated at about $25 billion. A direct consequence of inadequate fleet capacity, she noted, is the difficulty of travel within Africa, where journeys that should take five hours can sometimes stretch to two days.
Onyeali-Ikpe also acknowledged recent improvements, citing that more predictable foreign-exchange management due to government policies has helped stabilise the naira and improved operators' financial planning.
For airlines seeking funding, she advised the adoption of strong corporate governance, financial transparency, and operational discipline. She stressed that banks must adhere to international audit standards and have credible boards with industry experts to ensure safety and protect the public interest.
"We cannot afford a situation where airlines are run like family businesses. These are companies carrying 250 people at a time; governance must reflect that responsibility," she cautioned.
She concluded that specialised aviation funds remain the most effective way to build a resilient sector capable of meeting Nigeria and Africa's growing air transport demands, advocating for long-term partnerships between banks and transparent operators.
