By Elizabeth Adegbesan
The Federal Government’s spending on debt service payments fell year-on-year (YoY) by 38.5 percent to $405.3 million in January 2026 from N659.7 million in the corresponding period of 2025.
Analysis of data contained in the Central Bank of Nigeria’s, CBN, International Payment report showed that the downward trend also reflected in the federal government’s total debt service payment for 2025 compared to 2024.
Data showed that payments declined by 2.95 percent to $7.22 billion in 2025 from $7.44 billion in 2024.
The significant decline in debt service payment reflects reduced debt service across major debt instruments, particularly Federal Government Bonds (FGN Bonds) and Nigerian Treasury Bills (NTBs), both accounting for the bulk of Nigeria’s domestic debt service payments.
Additionally, the decline in debt service payment indicates reduced paper issuances in the primary market and yield compression in the fixed-income market during the review period.
The Debt Management Office (DMO) raised N5.26 trillion through the FGN bond market in 2025 to fund the federal budget deficit with total investor subscriptions reaching N8.96 trillion.
Likewise, in January 2026, Nigeria’s DMO heavily oversubscribed its initial N900 billion target, raising a total of N1.54 trillion through the sale of three FGN bonds.
As at September 30, 2025, Nigeria’s domestic debt stock had grown significantly, reaching N77.81 trillion driven by increased FGN bond issuances.
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