The Central Bank of Nigeria (CBN) in collaboration with the Financial Markets Dealers Association (FMDA) has introduced the Nigerian Overnight Financing Rate (NOFR).
The new initiative is a standardized benchmark, aimed at enhancing transparency, strengthening monetary policy transmission, and deepening Nigeria’s money market.
The introduction of the NOFR was made known in a statement issued on Sunday by the Director, Corporate Communications of the CBN, Mrs. Hakama Sidi Ali.
The apex bank explained that the NOFR was developed to align Nigeria with global best practices in short-term interest
rate benchmarks.
Moreover, it said the initiative is expected to improve price discovery and transparency, while promoting consistent pricing of money market instruments.
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“It will enhance the effectiveness of monetary policy, support financial innovation, boost investor confidence, and strengthen risk management across the financial system,” the CBN said.
The introduction of NOFR positions Nigeria alongside leading global benchmarks such as SOFR in the United States, SONIA in the United Kingdom, €STR in the Eurozone, and TONA in Japan.
Also, it complements African benchmarks such as the JIBAR in South Africa.
The CBN added that the benchmark was adopted after a stakeholder engagement session held on February 27, 2026, with market participants formally endorsing the initiative.
It further disclosed that following the subsequent regulatory approval, NOFR is now in use, with the CBN serving as the benchmark administrator.
“The bank will ensure governance, transparency, and regular publication of the rate,” the statement stated.
