The Nigerian capital market is working to get ready to move to T+1 settlement (clearing and settlement on the day after trade), starting 1 June 2026. Transfer of ownership, cash, and securities one business day after a trade is executed aims to reduce settlement risk significantly and give investors faster access to their funds.
The Securities and Exchange Commission has issued a notice on 14 May. It says the move to T+1 “forms part of the Commission’s ongoing market modernization initiatives aimed at enhancing market efficiency, strengthening risk management, reducing counterparty exposure, improving liquidity, and aligning the Nigerian capital market with international standards and global best practices.”
The change covers equities and commodities transactions cleared and settled by the Central Securities Clearing System Plc (CSCS). The CSCS says it affects “secondary market transactions across key platforms, including the Nigerian Exchange (NGX), the NASD OTC Securities Exchange, and the Lagos Commodities & Futures Exchange (LCFE).” However, it adds that fixed income instruments and commodities, which already operate on different cycles (such as T+2), will not be affected.
The CSCS frameworks and other documents on T+1 can be found on a dedicated page on the CSCS website: clearing and settlement operations framework, settlement operations framework for extended trading hours, and the default management procedure.
The Nigerian market moved to T+2 settlement on 28 November 2025. Friday 29 May 2026 is the final trading day under T+2. Trades executed on 29 May 2026 and Monday 1 June shall all settle on Tuesday 2 June.
According to the SEC notice: “All Capital Market Operators, Securities Exchanges, Clearing and Settlement Infrastructure Providers, Custodians, Registrars, Issuers, and other relevant stakeholders are required to take all necessary measures to ensure full operational readiness and compliance with the new settlement framework. Market participants are expected to review and align their systems, processes, controls, and operational workflows ahead of the implementation date.”
This article in Nairametrics by SEC Director General and CEO Emomotimi Agama says the most compelling case for T+1 is risk: “Every day that elapses between trade execution and settlement is a day during which a counterparty may default, a market may move adversely, or an operational error may compound into a financial crisis.” He also says it will unlock capital that is held waiting for a trade to settle.
“The Nigerian Capital Market Master Plan 2026–2036 envisions the NGX as a continental hub — a gateway for pan-African capital flows and a destination of choice for international investment. Realising that vision requires a post-trade infrastructure that meets international standards. T+1 is not an aspirational feature; it is a baseline requirement for the market Nigeria intends to build.
“The journey to T+1 is, at its deepest level, a journey about what kind of capital market we want Nigeria to have — and what kind of economic future we intend to build.”
Other global markets already on T+1
The US, Canadian, Mexican and Argentinian markets moved to T+1 settlement in May 2024 (see this article on the SWIFT website). Canada and Mexico officially moved on 27 May 2024, a day ahead of the USA market to avoid cross-border market disruption and because the US market was closed on 27 May for a holiday. An article in April 2024 by TD Securities highlights potential challenges facing cross-border trades, highlighting difficulties likely to be faced by UK and European funds.
India phased in T+1 settlement in 2023 and introduced a voluntary T+0 settlement cycle in March 2024. This article by global bank Citi describes the steps taken, including the transition phased over 11 months to move more than 5,000 listed securities.
Europe targets Oct 2027
The United Kingdom (UK), the European Union (EU) and Switzerland are moving to T+1 settlement cycle with a target of 11 October 2027. The changes will also apply to countries such as Norway, Iceland and Liechtenstein which are in the European Economic Area (EEA). An article by global bank JP Morgan says “This risk reduction may translate into lower margin requirements, improved market liquidity, and more efficient capital utilization.” It says the change is more significant than the move to T+2 in 2014: “.. as it requires all clients to provide accurate settlement instructions on the Trade Date (TD). The reduction of the one-day buffer means there is less time to address settlement mismatches.
An article by global funds network Calastone, headquartered in London, highlights that in UK and Europe T+1 will be particularly challenging for funds as their cashflows tend to settle over longer timeframes: “This creates a structural mismatch. In practice, it means that funds may need to pay for securities before subscription proceeds have been received, or manage the timing difference through cash reserves or credit facilities.”
Effect on liquidity in Nigeria?
An article last December in Punch Nigeria quoted Haruna Jalo-Waziri, then CEO of CSCS: “What is consistent in every market that moved from T+3 to T+2 and from T+2 to T+1: liquidity typically drops for about three or four months, sometimes by 10%, 20%, or about 5%. That’s because people are adjusting. After that, liquidity rises by 7% to 15% in many markets, sometimes even higher.” He said the faster settlement will encourage younger Nigerian to participate in the market.
This article by Dele Akintola of Alerzo in Nairametrics highlights some of the other trading and post-trade issues that worry investors and that he believes should have been higher priority than T+1.