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

The Nigerian capital market has achieved a historic first by becoming the leading exchange in Africa to successfully transition to a T+1 settlement cycle. This move places Nigeria alongside major global financial hubs like the United States in adopting a framework designed to boost efficiency and reduce risk. Under the new system, trades executed on the Nigerian Exchange Limited (NGX) will settle just one business day after execution. This is a significant improvement over the previous T+2 model, allowing investors to access their cash or securities much faster.

Dr. Emomotimi Agama, Director-General of the Securities and Exchange Commission (SEC), addressed the transition ceremony in Lagos. He said the shift aligns Nigeria with markets that account for roughly 60 per cent of global market capitalisation. According to him, this step is vital for improving the country’s competitiveness in attracting international capital. “The United States, Canada and Mexico transitioned to T+1 settlement on the weekend of 25–27 May 2024. India had already implemented T+1 in a phased approach since 2022 and 2023. The European Union, the United Kingdom, and Switzerland have now announced plans to adopt T+1 in October 2027,” he said. “The financial world is embracing T+1 rapidly, and what was once considered advanced is quickly becoming the baseline expectation for any market serious about competing for international capital.”

Agama explained that the shorter cycle reduces counterparty risks and enhances liquidity. He emphasized the direct benefit to everyday investors. “What does that mean for a retail investor in Lagos, Kano, or Port Harcourt who sells shares today? It means their cash is available tomorrow. Not in two days. Not in three. Tomorrow.” He said that Nigeria previously moved from a T+3 to a T+2 cycle in November 2025. The current transition was completed within six months. “Today, we are here. In just six months, we have closed that gap again. And we have done so without disrupting market operations, without shaking investor confidence, and without leaving any category of market participant behind.”

Looking ahead, Agama revealed that the SEC is already planning for same-day settlement. “Nigeria will not be left behind. The SEC has already signalled its intention to continue this journey toward T+0 settlement, not as a distant aspiration, but as a near-term regulatory planning objective.”

Umaru Kwairanga, Chairman of NGX Group, said the change would improve efficiency for investors. “If you buy today, your account will be debited tomorrow. If you sell today, you will get payment tomorrow,” Kwairanga said. “The move reinforces the Nigerian market as one of the most efficient markets globally.” He assured participants that market operators would keep introducing initiatives to make investing easier and more efficient.

This transition supports broader reforms under the Investments and Securities Act 2025. Regulators and operators are working to deepen the market and attract more domestic and foreign participation. Temi Popoola, Chairman of CSCS and Group CEO of NGX Group, said T+1 is part of a strategy to expand investment opportunities. “This is really not a destination at all. This is part of a longer journey that we’re trying to do,” Popoola said. He mentioned that stakeholders are working to move beyond traditional equities into private markets, fixed income, and digital assets. “How do we start to position the entire ecosystem away from just our regular shares and the regular equities that you know us for, how do we get into private markets, how do we get into fixed income, how do we get into digital assets?”

Shehu Shantali, Managing Director of the Central Securities Clearing System (CSCS), described the move as the latest step in a modernization process spanning over three decades. He recalled that CSCS was established in 1992 and began operations in 1997, transforming post-trade processes through automation. “Today’s transition to T+1, therefore, represents not a single event, but the latest chapter in a modernization journey that has been underway for more than three decades.” Shantali said the formal push for T+1 began in 2023 when the SEC set up a committee to assess market readiness. He added that CSCS invested heavily in infrastructure, including API integrations, enhanced processing systems, and cybersecurity upgrades. “The benefits of T+1 settlement are substantial. A shorter settlement cycle reduces counterparty risks by limiting the period between trade execution and settlement. It improves liquidity by enabling investors to access and redeploy capital more quickly.”