Nigeria’s industrial paper market has grown past N1.9 trillion, with the Securities and Exchange Commission (SEC) positioning the short-term debt market as a pipeline for firms in search of to lift capital by way of public choices.
The SEC Director-General, Emomotimi Agama, disclosed this whereas talking on the Duke in Business podcast, noting that the market was increasing quickly as firms more and more use industrial paper to satisfy short-term financing wants.
According to Nairametrics Research, 23 firms introduced industrial paper gives to the Nigerian cash market within the third quarter of 2026, focusing on a mixed N446.1 billion throughout 43 collection underneath programmes with a complete registered measurement of N1.98 trillion.
Unbelievable market growth
Agama described the market’s growth as “unbelievable,” highlighting its potential to arrange firms for broader participation in Nigeria’s capital market.
- “We have instituted the market, which is called the commercial paper market. The commercial paper market is growing at a speed that is unbelievable. As we speak today, the commercial paper market is over 1.9 trillion,” he stated.
Agama acknowledged that firms issuing industrial paper will not be essentially listed on the inventory alternate however stated their participation within the market might assist put together them for eventual public choices.
He described the market as a stepping stone for firms to turn out to be extra conversant in capital-raising necessities and investor expectations.
- “It brings something we call encouragement. And of course, we are leading them towards IPO. So it becomes a pipeline,” he stated.
According to the SEC chief, the fee is encouraging firms with acceptable company buildings, governance requirements, annual monetary statements and clear operations to take part within the market.
He stated the expertise gained by way of industrial paper issuance might assist these companies put together for future preliminary public choices (IPOs), probably broadening the vary of firms obtainable to buyers.
SEC targets broader market participation
Commenting on issues that 5 shares account for greater than 67% of the Nigerian inventory market’s whole valuation, Agama stated the precedence ought to be to increase participation somewhat than focus solely on market focus.
He stated monetary literacy, investor advocacy and demonstrating the worth of the capital market have been central to attracting extra firms and buyers.
- “It’s not having an issue. What is important, which is good for us, is to expand the space. And expanding the space is literacy. Expanding the space is advocacy. Expanding the space is making sure that the people involved see the value of the market,” he stated.
Agama additionally stated the SEC’s regulatory method over the previous two and a half years had centered on encouraging compliance somewhat than relying totally on penalties.
According to him, the fee’s revenue from non-compliance has declined as extra firms adjust to regulatory necessities.
- “If I get you to comply, I don’t need to fine you,” he stated.
He in contrast the method to parenting, arguing that regulators ought to assist companies perceive and meet their obligations somewhat than rely completely on punishment.
- “Yours is not always to flog your child. Yours is to make sure that your child understands what he or she should do. And then you guide the child to succeeding,” he stated.
10 gives dominate third-quarter issuance
Data tracked by Nairametrics Research confirmed that the ten largest industrial paper gives by goal measurement within the third quarter of 2026 collectively sought to lift N350 billion, accounting for 78.5% of the entire issuance focused in the course of the interval.
- All ten gives have been primarily directed at working capital financing, highlighting the function of economic paper in serving to Nigerian firms meet short-term liquidity necessities.
- Two of the ten gives have been structured as non-interest industrial paper underneath a Murabahah association.
- Under this construction, a particular function automobile procures commodities or belongings on behalf of the borrower and sells them on a deferred-payment foundation at an agreed revenue price. This supplies a Shariah-compliant various to traditional discount-based industrial paper.
The figures level to continued use of the market by firms in search of short-term funding, whereas the SEC is wanting to make use of participation within the market to encourage stronger company governance and create a possible pipeline of future IPO candidates.
