Nigeria’s capital market is preparing to adopt a shortened settlement timeline, known as T+2, which is scheduled to take effect on November 28, 2025. This transition represents a significant shift from the current three-business-day cycle (T+3) to two business days, a move widely welcomed by the market community as a critical upgrade to enhance efficiency and competitiveness.
The T+2 structure means that all payments for securities and the actual transfer of shares will be finalized precisely two business days after a trade is executed. Market operators and analysts stress that this change is essential for reducing settlement delays, significantly cutting risk exposure, and aligning Nigeria’s post-trade processes more closely with established international best practice.
Key Benefits and Strategic Impact
The move from T+3 to T+2 is viewed as a major modernization signal, vital for attracting both domestic and foreign investment. Investment firms observing the transition anticipate several key benefits:
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Lower Counterparty Risks: By decreasing the time lag between execution and completion, the risk of a counterparty failing to deliver funds or securities is substantially reduced.
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Improved Liquidity: Faster settlement frees up cash and securities more quickly, enhancing the overall liquidity of the market.
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Enhanced Competitiveness: Aligning with T+2 cycles used in more advanced global markets makes Nigeria more appealing to institutional investors seeking efficiency.
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Strengthened Confidence: A more resilient market with quicker fund and securities settlement boosts investor confidence, which in turn improves the market’s ability to support business growth, including for MSMEs (Micro, Small, and Medium Enterprises).
Operational Mandate and Preparations
The Central Securities Clearing System (CSCS), which manages settlement risks in the Nigerian market, emphasized that adopting T+2 directly supports its core mandate. The new cycle will reduce operational delays and minimize market exposure.
The organization has invested heavily in technology and infrastructure upgrades to ensure the entire market is fully prepared for the transition. These upgrades are designed to handle the faster timeline smoothly while maintaining the integrity and reliability of post-trade operations. The CSCS acknowledged the crucial support and collaboration received from the capital market regulator and other key institutions throughout the implementation phase. The successful adoption of T+2 marks a significant milestone in Nigeria’s efforts to modernize its processes and strengthen the foundation for future market growth.
