The Federal Government’s spending on debt service declined by 38.5 percent year-on-year to $405.3 million in January 2026, down from $659.7 million recorded in the corresponding period of 2025.
Data obtained from the Central Bank of Nigeria’s International Payment report showed that the downward trend was also reflected in the government’s total debt service payments for 2025 compared to 2024.
According to the data, total debt service payments fell by 2.95 percent to $7.22 billion in 2025 from $7.44 billion in 2024.
The decline was largely driven by reduced servicing of major domestic debt instruments, particularly Federal Government Bonds and Nigerian Treasury Bills, which account for a significant portion of Nigeria’s domestic debt obligations.
The development also suggests reduced issuance of government securities in the primary market as well as lower yields in the fixed-income market during the period under review.
Meanwhile, the Debt Management Office raised N5.26 trillion through the Federal Government bond market in 2025 to finance the federal budget deficit, with total investor subscriptions reaching N8.96 trillion.
Similarly, in January 2026, the agency exceeded its initial N900 billion target, raising N1.54 trillion through the issuance of three Federal Government bonds.
Despite the drop in debt service payments, Nigeria’s domestic debt stock continued to grow, reaching N77.81 trillion as of September 30, 2025, largely driven by increased Federal Government bond issuances.
