After six months of a successful migration from the T+3 to the T+2 settlement cycle, the Nigerian Exchange Limited (NGX) yesterday kicked off the implementation of the T+1 settlement regime, a move expected to accelerate the transfer of cash and securities, improve market liquidity and align the country’s capital market with global trends.

Under the new settlement cycle, investors who buy or sell securities on the exchange will have their transactions settled within a business day after the trade date, compared with two business days under the previous T+2 cycle.

In addition, processing time is also expected to drop significantly and change how quickly trades are completed and when investors can access their funds.

Speaking at the launch of the initiative in Lagos yesterday, the Director -General of the Securities and Exchange Commission (SEC), Dr Emomotimi Agama, said the transition marked another milestone in the ongoing modernisation of Nigeria’s capital market infrastructure.

“What does that mean for a retail investor in Lagos, Kano or Port Harcourt who sells shares today? It means their cash is available the following day, not in two days, not in three, but tomorrow. That is capital freed for reinvestment, for consumption, for business decisions, capital that previously sat locked in the settlement pipeline for longer than necessary.

“For institutional players and custodians, this shift requires an immediate reconfiguration of operations, faster reconciliation, tighter confirmation windows and more automated back-office processes. This is healthy pressure; it forces modernisation; it raises the operational standard of every participant in the market,” Agama said.

According to him, the adoption of T+1 settlement places Nigeria among a growing number of markets worldwide, including the United States, Canada and India, that have adopted faster settlement cycles to improve efficiency, deepen liquidity and strengthen investor confidence.

He noted that the United States, Canada and Mexico adopted the T+1 settlement cycle in May 2024 following a directive by the U.S. Securities and Exchange Commission (SEC) to enhance investor protection, reduce risks and improve market efficiency.

According to him, India had earlier implemented the T+1 regime in phases between 2022 and 2023, while the European Union, the United Kingdom and Switzerland are expected to migrate to the system in October 2027.

Agama added that markets currently operating the T+1 settlement cycle account for about 60 per cent of global market capitalisation, underscoring the rapid pace at which the financial world is embracing shorter settlement periods.

He said the development shows that faster settlement is no longer an innovation but a standard requirement for markets seeking to remain competitive and attract international investment.

Chief Executive Officer of CSCS Plc, Yahaya Shantali, disclosed that the transition would improve operational resilience, enhance transaction processing and deepen integration with global financial messaging systems and international market participants.

According to him, the upgrades were not undertaken solely to support the transition to T+1 settlement but to position Nigeria’s capital market for sustainable growth, greater efficiency and long-term competitiveness in the global investment landscape.

He pointed out that the CSCS remains committed to supporting the continued growth and transformation of the Nigerian capital market through sustained investment in innovation and technology.
He noted that the clearing house would continue to strengthen market infrastructure, deepen collaboration with stakeholders and enhance operational resilience to meet the evolving needs of the market.

According to him, CSCS will also support initiatives aimed at improving efficiency, promoting transparency and enhancing the overall experience of investors in the capital market.

Also speaking at the event, the Chairman of Central Securities Clearing System (CSCS) Plc Group Managing Director/Chief Executive Officer of NGX Group, Temi Popoola, said the transition represents a critical step in the broader evolution of
Nigeria’s capital market. He noted that while the achievement marks a significant milestone, it is part of a longer journey toward building a deeper, more liquid, and more globally competitive market capable of supporting sustained economic growth and capital formation.

“While today is a significant milestone, it is not the destination. It is part of a broader journey toward building a deeper, more liquid, efficient, and globally competitive capital market capable of supporting long-term economic growth and capital formation,” he said.

The Chairman of NGX Group, Dr Umaru Kwairanga, said the shift would be beneficial for investors and market practitioners alike, as it increases liquidity and efficiency in our market.

He commended market operators for their role in the successful implementation of previous reforms, expressing confidence that the transition to the T+1 settlement cycle would be equally seamless.

He said the achievements recorded so far in the market were made possible through the professionalism, commitment and cooperation of stakeholders, adding that the same spirit would ensure a smooth migration to the new settlement regime.