CBN, FMDA Launch Nigerian Overnight Financing Rate as New Money Market Benchmark

By Ifeyinwa Ike

The Central Bank of Nigeria (CBN) and Financial Markets Dealers Association (FMDA) have introduced the Nigerian Overnight Financing Rate (NOFR), a standardized benchmark to boost transparency and efficiency in the money market.

Announced on April 17, 2026, by FMDA’s Ag. Director of Corporate Communications, Hakama Sidi Ali (Mrs.), NOFR aligns Nigeria with global standards like SOFR (US), SONIA (UK), €STR (Eurozone), and TONA (Japan). It complements African benchmarks such as JIBAR (South Africa).

Following a February 27, 2026, stakeholder session, market participants formally adopted NOFR. With regulatory approval, the CBN now administers the rate, ensuring governance, transparency, and regular publication.

NOFR promotes consistent pricing of money market instruments, strengthens monetary policy transmission, enhances price discovery, supports financial innovation, boosts investor confidence, and improves risk management across Nigeria’s financial system.