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The Central Bank of Nigeria (CBN), in collaboration with the Financial Markets Dealers Association (FMDA), has announced the introduction of the Nigerian Overnight Financing Rate (NOFR). 

A statement by the apex bank, dated 17 April 2026, said that the NOFR is a standardised benchmark intended to enhance transparency, strengthen monetary policy transmission, and deepen Nigeria’s money market. 

The CBN added that the NOFR was developed to align Nigeria with global best practices for short-term interest rate benchmarks. “It is expected to improve price discovery and transparency while promoting consistent pricing of money market instruments. It will enhance the effectiveness of monetary policy, support financial innovation, boost investor confidence, and strengthen risk management across the financial system,” according to the statement. 

The CBN further said that the introduction of the NOFR positions Nigeria alongside leading global benchmarks such as SOFR (United States), SONIA (United Kingdom), €STR (Eurozone), and TONA (Japan). It also complements African benchmarks, including JIBAR (South Africa). 

Following a stakeholder engagement session on 27 February 2026, at which market participants formally adopted the Nigerian benchmark overnight interest rate, and subsequent regulatory approval, the NOFR is now in use, with the CBN serving as the benchmark administrator. 

The Central Bank said it will ensure governance, transparency, and the regular publication of the rate.

In the frequently asked questions and answers (FAQs) accompanying the statement, the CBN stated that the NOFR is Nigeria’s official overnight risk‑free interest rate benchmark, with rates published daily. It reflects the cost of overnight secured funding in the Nigerian interbank market and is based on actual market transactions, not estimates.

The CBN said the NOFR is a market-based reference rate, distinct from CBN monetary policy rates, such as the Monetary Policy Rate (MPR).

The FAQ document stated that eligible transactions are naira-denominated overnight secured repo transactions executed on the fixing day, reported by eligible banks, and with a minimum size of N5 billion. It added that the NOFR may be used for pricing, valuation, discounting, and risk management of naira-denominated instruments.