Nigeria Clears $3.4 Billion IMF Loan, But There's Still a Cost to Pay

 

The International Monetary Fund (IMF) has confirmed that Nigeria has successfully completed the repayment of the $3.4 billion loan it secured in 2020. This loan was taken to help Nigeria manage the economic challenges caused by the COVID-19 pandemic and the sharp decline in oil prices.

However, even though the loan has been fully repaid, Nigeria is still required to pay an annual fee of about $30 million in Special Drawing Rights (SDR), which is part of the terms tied to the loan.

The SDR is the IMF's international reserve asset, its value based on a basket of major currencies including the US dollar, euro, Chinese renminbi, Japanese yen, and British pound sterling. This fee is charged on the cost of borrowing from the IMF and is expressed in SDR.

According to the IMF’s data published on Thursday, Nigeria made the repayments in three installments: SDR613.62 million in 2023, SDR1.22 billion in 2024, and another SDR613.62 million in 2025. The IMF statement noted, “As of April 30, 2025, Nigeria has fully repaid the financial support of about US$3.4 billion it requested and received in April 2020 from the International Monetary Fund (IMF) under the Rapid Financing Instrument to help alleviate the impact of the COVID-19 pandemic and the sharp fall in oil prices.”

Despite the loan being paid off, Nigeria will continue to make annual SDR payments of around $30 million. These charges are due to the difference between Nigeria's current SDR holdings of SDR3,164 million (approximately US$4.3 billion) and its total SDR allocation of SDR4,027 million (about US$5.5 billion).

The IMF stated that these charges will stop once Nigeria's SDR holdings match its cumulative SDR allocation.