Adedokun Waliyu 
The Central Bank of Nigeria has introduced the Nigerian Overnight Financing Rate (NOFR), a new benchmark aimed at improving transparency and efficiency in the country’s money market.
The rate, developed in partnership with the Financial Markets Dealers Association, will serve as a standardised reference for overnight funding. According to the apex bank, it is designed to strengthen monetary policy transmission and deepen Nigeria’s financial system.
In a statement signed by Hakama Sidi Ali, the bank explained that NOFR 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 CBN stated that the benchmark is expected to improve transparency, promote financial innovation, boost investor confidence, and strengthen risk management across the financial system.
With this development, Nigeria joins countries using similar 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), while also complementing Africa’s Johannesburg Interbank Average Rate (JIBAR).
The bank noted that the introduction of NOFR followed a stakeholder engagement session held in February 2026, where market participants adopted the rate before receiving regulatory approval for implementation.
