The Securities and Exchange Commission (SEC) has said the adoption of the T+1 settlement cycle in Nigeria’s capital market is progressing smoothly, with local and international investors expressing satisfaction with the new regime.
The Commission said the transition has enhanced the competitiveness and efficiency of the Nigerian capital market, while also providing relief to market participants by allowing transactions to be settled faster.
The Director-General of the SEC, Dr Emomotimi Agama, disclosed this in an interview with journalists in Abuja at the weekend.
Agama, who was represented by the Director of Registration, Exchanges and Market Infrastructure, Mrs Hafsat Rufai, said initial concerns over the ability of investors to source funds for settlement had been successfully addressed.
According to her, feedback from both domestic and foreign investors has been encouraging since the market migrated to the T+1 settlement cycle on June 1, 2026.
“Feedback from them has been excellent. They are happy with T+1, and the local investors are also happy with T+1. The fear initially was around the availability of cash to settle, with time zone being one of the major considerations.
“Sometimes, when we are closing our market at 4:00 p.m., it is still early in the day in some countries. In some others, it is midnight, and so everybody was concerned about how to source cash or funds for settlement.
“But knowing that settlement is not at 8:00 a.m. but at 5:00 p.m., I think that gives enough time for the custodian banks, who represent those investors, to source the funds required and settle the securities and cash because it is a delivery-versus-payment market,” she said.
Agama said no default had so far been recorded as a result of the unavailability of funds under the new settlement deadline.
He said the 5:00 p.m. settlement window had given market participants enough time to meet their obligations.
“It is just a matter of letting everybody understand that the settlement time is not 8:00 a.m.; it is 5:00 p.m. And by 5:00 p.m., everybody is good. So far, it has been good, and feedback has also been very excellent,” he said.
The SEC DG explained that the Nigerian capital market had operated on a T+3 settlement cycle for several years before beginning a phased transition aimed at modernising the market, improving competitiveness and attractiveness, increasing liquidity and reducing settlement risks.
He said the market moved from T+3 to T+2 on November 28, 2025, before fully migrating to T+1 on June 1, 2026.
Under the T+1 regime, a transaction carried out on a particular trading day, known as “T”, is settled by the next business day.
“Transaction day or the trade day is when your shares are bought or sold on a particular day. That is day T, and plus one, which is the current settlement cycle, means that when you buy your shares today, the shares will settle in your account by 5:00 p.m. tomorrow,” he explained.
According to Agama, shortening the settlement cycle was aimed at making the Nigerian capital market more efficient by ensuring that investors receive their securities or cash sooner.
He said the previous T+2 and T+3 settlement systems required investors to wait longer before receiving either their securities or proceeds from a transaction.
“Now we decided that we need to do better for the Nigerian market by shortening that settlement cycle. Why buy today and wait for another 48 hours or thereabout before you get your security? So, we shortened the settlement cycle to T+1, meaning that the trade day and a day after,” he said.
The SEC boss further disclosed that the settlement deadline was shifted from 8:00 a.m. to 5:00 p.m. following the extension of trading hours on the Nigerian Exchange (NGX).
Trading hours on the NGX were earlier extended from 2:30 p.m. to 4:00 p.m.
“If market closes at 4:00 p.m. and we ask people to settle, that is, to provide cash and securities, at 8:00 a.m. the next day, that is almost close to being T+0. It would be almost as good as telling people to pay today, and we do not want that strain,” he said.
The SEC said the new T+1 settlement regime was designed to balance faster settlement with the need to give investors and their custodians sufficient time to arrange funds and securities, while strengthening the overall efficiency and competitiveness of Nigeria’s capital market.
