NGX deepens Nigeria’s short-term debt market

PHOTO

The Nigerian Exchange Limited has expanded its product offerings with the introduction of Commercial Paper (CP) listings, a move that further deepens Nigeria’s short-term debt market and strengthens the Exchange’s role as a major hub for capital formation.

The new CP listing window follows regulatory approval by the Securities and Exchange Commission and allows corporate issuers to list and trade both conventional and non-interest commercial papers directly on the Exchange. Market operators say the initiative will improve transparency, enhance liquidity and widen funding options for businesses.

With the latest addition, Nigerian Exchange Limited now provides an integrated market covering equities, fixed income, exchange-traded funds, derivatives and short-term debt instruments, further advancing its ambition to operate as a one-stop marketplace across asset classes.

Speaking on the launch, Group Managing Director and Chief Executive Officer of NGX Group, Temi Popoola, described the development as a strategic milestone in the Exchange’s growth drive.

“The introduction of Commercial Paper listings is a pivotal step in our strategy to position NGX as a comprehensive capital-markets infrastructure that accelerates capital formation across Africa,” Popoola said.

“As we continue strengthening the foundations of a transparent, technology-driven and inclusive marketplace, our focus remains on building a system that supports sustainable growth, enhances market resilience and unlocks new opportunities for the broader economy.”

Commercial Papers are short-term, unsecured debt instruments issued by corporates primarily to finance working capital and meet short-term obligations.

They typically mature within 270 days and are issued at a discount, providing companies with a cheaper alternative to bank borrowing, while offering investors attractive short-term investment opportunities.

Chief Executive Officer of the Exchange, Jude Chiemeka, said the new platform significantly boosts funding access for businesses outside traditional banking channels.

“The introduction of Commercial Paper listings represents a major advancement in our mission to provide a full spectrum of capital-raising solutions for businesses,” Chiemeka stated.

“This platform enhances transparency in the debt market and supports corporates seeking efficient access to funding, while offering investors credible short-term investment options. We will continue to engage with issuers, intermediaries and investors to deepen liquidity and participation in Nigeria’s debt capital market.”

Also speaking, the Chief Executive Officer of NGX Regulation Limited, Olufemi Shobanjo, emphasised that strong regulation and disclosure standards would underpin the evolution of the new market segment.

“Our priority is to maintain high standards of disclosure, promote accountability and safeguard investor confidence while contributing to market deepening,” Shobanjo said.

The CP listing framework is also expected to boost activity in the fixed income space, improve price discovery and attract both institutional and retail investors seeking short-term, relatively low-risk investment opportunities.

Over the past year, NGX has intensified product innovation across asset classes as part of a broader strategy to strengthen the domestic capital market and compete more effectively with peer exchanges across Africa.

With commercial papers now firmly on its platform, operators believe the Exchange has taken another decisive step toward enhancing market depth, supporting business growth and mobilising short-term capital for Nigeria’s real economy.