Nigeria Becomes First African Market to Adopt T+1 Settlement Cycle

Nigeria has become the first capital market in Africa to adopt a T+1 settlement cycle, a significant milestone in the country’s efforts to modernize its financial markets and align with global best practices.

The transition officially commenced on Monday following months of industry-wide preparations involving regulators, exchanges, depositories, custodians, registrars, stockbrokers and other market participants.

The new framework reduces the settlement period for securities transactions from two business days (T+2) to one business day (T+1), enabling investors to receive cash or securities faster after executing trades.

Speaking at the T+1 Settlement Cycle Transition Ceremony in Lagos, the Director-General of the Securities and Exchange Commission (SEC), Emomotimi Agama, described the development as a landmark achievement in the evolution of Nigeria’s capital market.

According to Agama, the successful transition demonstrates Nigeria’s readiness to implement reforms necessary to compete effectively for global capital.

“The era of T+1 has begun. In just six months, Nigeria has successfully progressed from T+2 to T+1 settlement, joining a growing group of markets embracing faster and more efficient settlement cycles. This achievement signals that Nigeria is prepared to undertake the structural reforms required to compete for global capital,” he said.

The SEC noted that shorter settlement cycles have become an important feature of modern capital markets globally due to their ability to reduce counterparty risk, improve post-trade efficiency and strengthen investor confidence.

Industry stakeholders believe the move will enhance liquidity, improve operational efficiency and make the Nigerian market more attractive to both domestic and foreign investors.

Chairman of Nigerian Exchange Group, Umaru Kwairanga, said the transition reflects the commitment of market stakeholders to strengthening institutions and enhancing the competitiveness of Nigeria’s financial markets.

He stated that the reform would reinforce investor confidence while supporting economic growth and capital formation.

Similarly, Group Managing Director and Chief Executive Officer of NGX Group, Temi Popoola, described the transition as a critical step in the ongoing development of the Nigerian capital market.

According to him, the implementation of T+1 settlement should be viewed as part of a broader effort to build a deeper, more liquid and globally competitive market capable of supporting long-term economic growth.

Managing Director and Chief Executive Officer of Central Securities Clearing System Plc, Shehu Shantali, said the transition demonstrates the operational readiness of Nigeria’s post-trade infrastructure.

He noted that the shorter settlement cycle would improve transaction efficiency, reduce settlement risk and strengthen the resilience of the market ecosystem.

The ceremony concluded with a symbolic closing gong session to mark the official commencement of the T+1 settlement cycle, attended by regulators, exchange officials, market operators, stockbrokers and representatives of various trade associations.

The transition places Nigeria among a select group of global markets that have adopted faster settlement cycles to improve market efficiency and reduce systemic risk.

For investors, the T+1 framework means quicker access to funds and securities, reduced settlement exposure and enhanced market efficiency.

For the broader economy, it represents another step toward strengthening Nigeria’s position as a competitive destination for investment capital.

Market participants are expected to closely monitor the implementation phase as the new settlement structure becomes fully integrated into daily trading activities across the Nigerian capital market.