FAAN to Hike Tariffs and Ban Cash Payments
Written by Blessing Ajibuwa on June 24, 2025
The Federal Airports Authority of Nigeria (FAAN) has announced plans to increase tariffs for service providers operating at its airports and phase out cash payments in favor of a fully automated, contactless payment system. This move aims to improve revenue generation and modernize the authority’s operations.
Key Highlights
– *Tariff Increase*: FAAN plans to hike tariffs for service providers at its airports to boost revenue.
– *Automated Payment System*: The authority will introduce a fully automated, contactless payment system to enhance transparency and efficiency.
– *Early Notification*: FAAN has assured service providers that they will be notified early enough before the tariff increase is implemented.
Impact on Airports
The introduction of automated payment systems and tariff increases is expected to have a significant impact on airports in Nigeria. The move aims to improve revenue generation and reduce revenue leakages. FAAN’s Managing Director, Olubunmi Kuku, emphasized the benefits of automation, including increased efficiency and reduced costs.
FAAN’s Revenue Structure
FAAN currently generates 92% of its revenue from aeronautical sources, while only 8% comes from non-aeronautical activities. The authority plans to rebalance its revenue structure through lease agreement restructuring and digital payment reforms. This move is expected to increase revenue from non-aeronautical sources and reduce dependence on aeronautical revenue.
Conclusion
The planned tariff increase and introduction of automated payment systems by FAAN are expected to have a significant impact on airports in Nigeria. The move aims to improve revenue generation, and enhance transparency, and is expected to benefit both the authority and service providers.
