WorldStage– Securities and Exchange Commission (SEC) says the transition to the T+1 settlement cycle on the Nigerian Exchange Ltd. (NGX) will significantly reduce the probability of failed trades and strengthen market stability.
Its Director-General, Dr Emomotimi Agama, said this during a virtual discourse titled “Driving Market Readiness: Trade Associations and the Transition to T+1 Settlement Cycle”, on Friday.
The event was organised by the Central Securities Clearing System Plc.
Agama was represented by Ms Hafsat Rufai, Director in charge of Registration, Exchanges and Market Infrastructure at the SEC.
He said the shorter settlement cycle would compress risks associated with the period between trade execution and settlement finality.
“By halving the settlement window, we materially reduce the probability of failed trades, the exposure of clearing members and the systemic vulnerability that exists between agreement and finality,” he said.
The SEC DG said the T+1 framework would also improve market liquidity by enabling faster access to proceeds from share sales.
Agama said, “An investor who sells shares on Monday receives value on Tuesday.
“That is liquidity placed in the hands of Nigerians one day faster, liquidity that can be reinvested, redeployed or simply enjoyed.”
He said the reform aligns Nigeria with global markets such as the United States, India, Canada and Mexico, which have adopted T+1 settlement cycles.
Agama said Nigeria could not afford to lag behind in settlement infrastructure if it intends to remain competitive for global capital.
The SEC DG described the transition as part of broader reforms to reposition the capital market.
He said Nigeria’s reclassification to frontier market status, effective Sept. 21, signalled renewed international confidence in the financial system.
Agama disclosed that independent analysts projected inflows of between $840 million and $1.04 billion into Nigerian equities following the reclassification.
He added that market capitalisation had crossed the N160 trillion mark, with strong investor interest in major listed companies including MTN Nigeria, Dangote Cement, Zenith Bank, Nestlé Nigeria and Nigerian Breweries.
He said reforms such as the Investments and Securities Act 2025, Nigeria’s removal from the Financial Action Task Force grey list, moderating inflation and improved corporate governance were strengthening the market.
Agama urged market operators, including brokers, custodians, registrars and settlement banks, to upgrade systems to meet T+1 requirements.
He also said SEC was considering a future transition to T+0 (same-day settlement) when the ecosystem becomes fully ready.
He said, “T+1 is a station, not the terminal.
“When the ecosystem is ready, we will take the final step. Nigeria will stand among the most settlement-efficient markets in the world.”He said the transition, scheduled for June 1, would mark a new phase of efficiency, transparency and global integration for the capital market.
