Digital infrastructure: Nigeria seeks long-term capital as data demand surges

By Onu Okorie
Nigeria is seeking to attract longer-term investment into its digital infrastructure as rapidly rising data consumption, inadequate power supply and gaps in middle-mile connectivity threaten to constrain the country’s digital economy.
This was the central concern at the Nigeria Digital Connectivity Investment Forum 2026, organised by the Nigerian Communications Commission (NCC) in partnership with Swedfund and Ookla in Abuja.
The two-day forum, which brought together government officials, regulators, investors, development finance institutions, telecommunications operators, infrastructure companies and technology providers, focused on how to unlock fresh capital for broadband and digital infrastructure.
Participants warned that the financing model currently available to the sector does not adequately match the long life of telecommunications infrastructure, with calls for more long-tenor naira financing, blended finance and credit-enhancement mechanisms.
The forum noted that infrastructure financing in Nigeria had grown from less than ₦70 billion in 2004 to ₦19.4 trillion in 2025, but stressed that access to capital remained dependent on predictable policies, sound governance and the ability to develop bankable projects.
Chief Executive Officer of Chapel Hill Denham, Bolaji Balogun, said investors needed clearly structured and commercially viable projects capable of attracting long-term institutional capital.
Similarly, Chairman of FCMB and Managing Director of Financial Derivatives Company, Bismarck Rewane, highlighted the importance of the cost and availability of capital, investor confidence and policy predictability in determining the pace of infrastructure investment.
The urgency of the funding challenge is being driven by rapid growth in demand for connectivity.
Participants disclosed that Nigeria consumed about 1.6 million terabytes of data in July 2026, representing an increase of almost 47 per cent over 12 months.
Mobile subscriptions are also projected to rise from approximately 195 million to 350 million within the next 10 to 15 years, while growing demand from cloud computing and artificial intelligence is expected to put additional pressure on telecommunications networks, data centres and electricity supply.
The forum, however, identified a paradox in Nigeria’s connectivity landscape: although mobile broadband coverage has reached about 90 per cent of the population, smartphone ownership remains at about 27 per cent, while broadband penetration stands at 57.4 per cent, below the national target of 70 per cent.
Participants therefore argued that the next phase of Nigeria’s digital expansion cannot be measured simply by network coverage.
They identified device affordability, digital skills and consumer trust as increasingly important barriers to meaningful connectivity.
The forum also identified electricity supply and middle-mile connectivity as two of the biggest constraints facing further deployment.
For telecommunications tower companies, participants noted that the cost and reliability of power had become central to the economics of network expansion, while expensive inland connectivity was limiting the development of data centres and internet services outside major metropolitan areas.
They called for energy and telecommunications infrastructure planning to be integrated, with clusters of telecommunications towers potentially serving as anchor customers for distributed renewable power generation.
Another major concern was the regulatory environment at state level, particularly Right of Way (RoW) charges and permitting requirements.
The pilot Nigeria Digital Connectivity Index across 12 states reportedly showed that RoW reforms had translated into fibre growth of between 22 per cent and 95 per cent in states that introduced reforms.
The number of states charging zero RoW fees has also increased from seven in December 2024 to 12, according to the forum.
Participants consequently urged state governments to reduce and harmonise RoW and site-permit charges, shorten approval timelines and adopt the federal model under which the company laying fibre is responsible for reinstating roads.
The forum also placed renewed emphasis on the Federal Government’s Project BRIDGE, the planned 90,000-kilometre national fibre backbone, describing it as a strategic response to Nigeria’s middle-mile connectivity deficit.
Participants called for faster delivery of the project alongside measures to improve the availability and reliability of electricity for digital infrastructure.
The NCC was urged to continue reforms aimed at improving the investment environment, including tariff realignment, the designation of critical national information infrastructure and engagement with states over RoW.
The Commission was also asked to publish the first national Nigeria Digital Connectivity Index report, advance open-access and wholesale regulation and finalise the framework for direct-to-device services.
Beyond government-led infrastructure, stakeholders advocated greater use of shared infrastructure and neutral-host models to reduce the cost of extending coverage to rural communities and improving indoor connectivity.
They also highlighted emerging technologies and business models, including shared rural networks, satellite services capable of connecting existing handsets, micro-cabling and solar-powered rural sites.
The forum stressed, however, that infrastructure expansion alone would not guarantee meaningful connectivity without affordable smartphones and other user devices.
Investors and development finance institutions were therefore urged to align financing with the 20- to 30-year lifespan of digital infrastructure, rather than relying predominantly on short-term bank financing.
Participants recommended the use of blended finance and credit enhancement to bring projects that are not yet commercially viable to market, while infrastructure funding should increasingly be linked to independently verified network performance.
The forum also agreed on a series of actions to be pursued over the next two years.
Within six months, stakeholders are expected to work towards securing funding for community-owned rural networks powered by renewable energy in communities with no connectivity, with the Universal Service Provision Fund, state governments and the Rural Electrification Agency identified as potential partners.
Within six to 18 months, participants want open-access and wholesale regulations issued, a wholesale rate card published and broadband mapping completed.
They also called for stronger regulatory backing for the Universal Service Fund as the principal source of funding for underserved-area connectivity projects, supported by blended public and multilateral finance.
Over the same period, stakeholders are expected to develop a business case for indoor coverage in commercial buildings and incorporate data-centre requirements into the National Broadband Plan, including the use of renewable and off-grid power supported by blended financing.
Within 18 to 24 months, participants want a financing framework developed for telecommunications power, with energy provision standardised through regulation and brought within the protection framework for critical national information infrastructure.
They also called for metro and access fibre networks to be developed under concession arrangements, mapped against existing infrastructure and integrated with Project BRIDGE.
The forum’s conclusions suggest that Nigeria’s next digital infrastructure challenge is no longer simply about laying more fibre or erecting more telecommunications towers.
Rather, stakeholders said the country must simultaneously solve the financing, electricity, regulatory, affordability and data problems that determine whether infrastructure can be deployed, maintained and effectively used.
The Nigerian Communications Commission pledged to sustain engagement with investors, financiers, operators, government agencies and other stakeholders to advance the identified investment pathways.
With data consumption rising sharply and new technologies such as artificial intelligence and cloud computing expected to intensify demand, participants agreed that the ability to mobilise patient capital and remove deployment bottlenecks would be critical to determining whether Nigeria can build the digital infrastructure required to support its next phase of economic growth.