Nigeria Spends N5.28tn on Domestic Debt Servicing in First Half of 2026

Nigeria spent N5.28tn servicing domestic debt between January and June 2026. Interest and rental payments took N4.95tn, while N333.96bn went to principal repayment on promissory notes, according to Debt Management Office data.

Bonds and T-bills drive the bill

Federal Government bonds accounted for the largest share of domestic debt interest payments at N3.35tn. Nigerian Treasury Bills followed with N1.49tn, making the two instruments the dominant contributors to the six-month bill.

Monthly payments on FGN bonds fluctuated. They rose from N462.44bn in January to N707.25bn in February and peaked at N792.34bn in March. The amount fell to N530.84bn in April and N332.49bn in May before rising to N525.05bn in June.

Treasury bill interest payments reached N1.49tn over the period, with March recording the highest monthly amount of about N481.47bn.

Sukuk, savings bonds and green bonds

Other domestic instruments also attracted payments. The government spent N92.29bn on rentals for Federal Government Sukuk. Interest on FGN Savings Bonds amounted to N8.90bn, while Green bond interest payments stood at N5.56bn.

Beyond interest, the Federal Government repaid N333.96bn in principal on promissory notes between January and June. March recorded repayments of N154.23bn, while June followed with N136.96bn, making them the largest monthly contributors to principal repayments. Of the total, N263.27bn related to naira-denominated promissory notes. Foreign-currency-denominated notes accounted for N70.69bn.

Monthly outlay swings

Total monthly domestic debt service, covering interest, rentals and principal repayments, varied significantly. March recorded the highest expenditure at N1.43tn, followed by February at N967.67bn. June’s total stood at N811.62bn. April recorded N765.19bn and January N741.82bn. May had the lowest monthly outlay at N567.16bn.

The N5.28tn expenditure adds to concerns about the share of government revenue required to meet debt obligations. It could limit funds available for capital projects and essential public services.

“If you keep spending this huge amount on repaying your local debt, you will be left with less for important development issues,” said Abuja-based economist Nonso Iheoma. “Though we can’t do without debts, we can do well by changing the sources of the debts. During this period, returns on fixed-income securities exceeded or were close to 20 per cent due to high interest rates,” he added.

Nigeria’s total debt-service expenditure reached about N16tn in 2025, reflecting pressure from domestic interest payments and external debt obligations.