Nigeria’s Securities and Exchange Commission has released fresh guidelines for the transition of the country’s capital market from the current T+2 settlement system to a faster T+1 settlement cycle. The new framework will officially take effect on June 1, 2026. The directive, announced by the commission, is part of ongoing efforts to modernise the Nigerian capital market, improve liquidity, reduce risks, and align the system with global financial standards. Under the new arrangement, transactions involving equities and commodities will now be settled one business day after a trade is completed instead of the existing two business day structure.
According to the SEC, May 29, 2026, will serve as the final trading day under the T+2 system. Transactions executed on May 29 and June 1 will both settle on June 2, creating a smooth transition period before the full implementation of the new settlement cycle. The commission directed all market operators, including brokers, custodians, securities exchanges, registrars, clearing houses, and other stakeholders, to ensure complete operational readiness before the implementation date. This includes updating internal systems and workflows to prevent delays or settlement failures once the transition begins.
The SEC explained that shortening the settlement period would significantly reduce counterparty risk, which refers to the possibility of one party failing to complete its part of a transaction before settlement is finalised. With the new T+1 cycle, exposure to such risks will be reduced because trades will now be completed faster. Industry experts also believe the new framework will improve capital efficiency across the market. Investors, brokers, and custodians will gain faster access to cash and securities, allowing them to reinvest funds more quickly and increase trading activities. Retail investors are also expected to benefit because proceeds from share sales will now become available earlier than before.
Nigeria’s move follows a growing global trend among major financial markets. The United States adopted the T+1 settlement cycle in May 2024, while countries such as Canada, Mexico, and India have also moved toward shorter settlement periods to improve market efficiency and investor confidence. The Nigerian capital market has moved rapidly in recent months, first transitioning from T+3 to T+2 in late 2025 and now preparing for T+1 within less than a year.
Analysts say the pace of reform reflects Nigeria’s determination to strengthen market infrastructure and attract more foreign investment into the economy. The SEC warned that market participants who fail to upgrade their systems before the implementation date could face settlement disruptions and possible regulatory sanctions. The commission therefore urged all stakeholders to complete testing and align operations ahead of the June 1 rollout.
