The Central Bank of Nigeria (CBN) has announced the introduction of the Nigerian Overnight Financing Rate (NOFR).
This new rate, in partnership with the Financial Markets Dealers Association (FMDA), will act as a new benchmark designed to improve transparency and efficiency in the country’s money market.
READ ALSO: Oil Plunges, Stocks Jump As Iran Declares Hormuz Open
In a statement released on Friday and signed by the Acting Director of Corporate Communications, Hakama Sidi Ali, the apex bank said the NOFR would serve as a standardised reference rate for overnight funding, helping to strengthen monetary policy transmission and deepen Nigeria’s financial system.
According to the CBN, the new benchmark aligns Nigeria with global best practices in short-term interest rate frameworks, while enhancing price discovery and ensuring consistent pricing of money market instruments.
“The Nigerian Overnight Financing Rate is expected to improve transparency, promote financial innovation, boost investor confidence, and strengthen risk management across the financial system,” the statement said.
The introduction of NOFR places Nigeria alongside leading global benchmark rates such as the Secured Overnight Financing Rate (SOFR), Sterling Overnight Index Average (SONIA), Euro Short-Term Rate (€STR), and Tokyo Overnight Average Rate (TONA). It also complements Africa’s Johannesburg Interbank Average Rate (JIBAR).
The CBN disclosed that the development of the benchmark followed a stakeholder engagement session held on February 27, 2026, during which market participants formally adopted the rate. This was followed by regulatory approval, paving the way for its implementation.
The move also complements regional benchmarks such as the Johannesburg Interbank Average Rate (JIBAR), reinforcing Nigeria’s integration into global financial markets.
