FAAN Set To Increase Airport Tariffs, Decries Over-Reliance On Flight Revenue

 FAAN Set To Increase Airport Tariffs, Decries Over-Reliance On Flight Revenue

The Federal Airports Authority of Nigeria (FAAN) has announced upcoming tariff hikes across all Nigerian airports, citing the need to meet operational demands and reduce overdependence on aeronautical revenue.

Speaking during the Stakeholders Engagement Forum hosted by the Directorate of Commercial and Business Development (DCBD) in Lagos, FAAN Director of Commercial and Business Development, Adebola Joy Agunbiade, emphasized that the revision of tariffs was long overdue. Eyes Of Lagos reports,

“We will give service providers enough notice to prepare ahead. The goal is to ensure the increase is fair while helping us meet financial obligations,” she said.

FAAN: 92% of Revenue from Flights, Only 8% from Other Sources

Agunbiade expressed concern that 92% of FAAN’s revenue is aeronautical, derived directly from flight operations, while a mere 8% comes from non-aeronautical sources like retail concessions, leases, and advertisements. She compared this to global standards, where non-aeronautical income contributes over 40% of airport revenue in many advanced economies.

“We must restructure and diversify our income streams,” she said.

Lease Agreements and Payment Systems Under Review

Agunbiade also disclosed plans to revamp lease agreements, noting that many past agreements were poorly understood or outdated.

“We’ve reviewed all existing terms with our legal team. Renewals and new applicants will encounter updated conditions designed to be both enforceable and business-friendly.”

She further revealed that FAAN is set to implement automated, contactless payment systems. The new ‘tap-and-go’ airport card will be rolled out across terminals to improve payment transparency and customer convenience.

“We’re already piloting this in Lagos and plan to expand it to other airports. It will simplify transactions for both passengers and vendors,” she added.

Infrastructure Upgrades and New Revenue Streams

FAAN’s Managing Director, Olubunmi Kuku, noted that significant investments have gone into infrastructure upgrades and automation, with Lagos leading the transformation.

“We’re deploying Electronic Cash Registers (ECRs) across terminals. It’s part of our broader digital migration to promote accountability and traceable payments,” she said.

Kuku also revealed that ₦2 billion was realized from below-the-line revenue platforms last year — a promising opportunity for investors interested in non-flight-dependent income.

Clampdown on Illicit Activities at Airports

In a stern warning, Kuku declared that car hire operators and Bureau de Change vendors caught engaging in touting or unauthorized activities would have their licenses revoked.

She also spoke on efforts to decongest Lagos airport access roads, noting that tankers and roadside businesses would be forcefully removed if necessary.

“The current state of the roads is a security risk and not acceptable for an international airport. Drastic action will be taken,” she emphasized.

Conclusion

With a renewed focus on financial sustainability, digital transformation, and airport modernization, FAAN is positioning Nigeria’s aviation industry for long-term growth. However, the upcoming tariff hike means airlines, service providers, and vendors must prepare for operational adjustments.