CBN Launches New Shari’ah-Compliant Tools to Strengthen Nigeria’s Non-Interest Financial Market
The Central Bank of Nigeria (CBN) has introduced innovative liquidity management instruments to advance the country’s growing non-interest financial sector. These new tools aim to improve market structure, expand participation, and uphold ethical standards in line with Shari’ah principles. The announcement came through a circular dated May 23, 2025, signed by the Acting Director of the Financial Markets Department, Okey Umeano.
The instruments unveiled include the Nigerian Non-Interest Financial Institutions’ Master Repurchase Agreement (NNMRA), the CBN Non-Interest Asset Backed Securities (CNi-ABS), and the CBN Non-Interest Note (CNIN). The NNMRA standardizes repurchase agreements in the non-interest segment, enhancing clarity and risk management while incorporating the Central Bank as a counterparty to transactions.
Additionally, the CNi-ABS is a liquidity instrument backed by Shari’ah-compliant tangible assets, designed to support the operational needs of non-interest banks without compromising Islamic finance principles. The CNIN provides an interest-free, short-term liquidity option offered through scheduled auctions, aimed at broadening access to non-interest financial solutions.
To ensure effective regulation and operation, all market participants are advised to consult the Revised Guidelines for the Operation of Non-Interest Financial Institutions’ Instruments (2022). The CBN also placed restrictions on banks accessing its discount window on auction days for the new instruments, safeguarding monetary policy integrity by preventing arbitrage.
With Nigeria’s non-interest financial market steadily expanding, the CBN reaffirmed its commitment to developing a diverse, inclusive, and ethically grounded financial ecosystem. These initiatives are expected to enhance liquidity efficiency and attract wider participation from both domestic and international investors, supporting overall financial stability and economic inclusion.