Commercial paper (CP) programmes approved by the Securities and Exchange Commission (SEC) rose to ₦1.37 trillion as of October 23, 2025, underscoring the growing reliance of Nigerian corporates on short-term debt to fund operations amid tight credit conditions.
However, actual drawdowns from the approved programmes remained significantly lower. Data from the Commission show that corporates raised about ₦753 billion across multiple series and tranches, translating to a utilisation rate of roughly 54 per cent.
The wide gap between approved limits and funds raised points to a cautious issuance strategy, with companies increasingly accessing the CP market in phases rather than fully drawing down programme sizes at once.
Issuance concentrated among large corporates
Issuance activity during the period was heavily concentrated among a few large corporates, led by Dangote Sugar Refinery Plc. Operating under a ₦300 billion programme, the company accounted for more than 45 per cent of total CP issuance, raising over ₦300 billion across several series.
Dangote Sugar’s dominance highlights how large, cash-intensive firms are increasingly leaning on the CP market to manage working capital requirements and refinance short-term obligations.
Outside Dangote Sugar, issuance was more dispersed across financial services, agribusiness and consumer sectors. Johnvents Industries Limited raised about ₦52.6 billion from its ₦100 billion programme, while UAC Nigeria Plc issued ₦45 billion under a ₦65 billion approval.
In the financial sector, Citibank Nigeria Limited, despite operating a sizeable ₦300 billion CP programme, drew only ₦26.7 billion across two series, reflecting relatively modest utilisation.
Dangote Sugar leads by wide margin
Dangote Sugar Refinery Plc emerged as the single largest contributor to CP market liquidity in 2025. Issuing multiple tranches from Series 10 to Series 16, the company’s individual issuances ranged from ₦4.7 billion to ₦96.7 billion, collectively exceeding ₦300 billion.
Its repeated access to the market reflects both its scale and the growing dependence of major corporates on short-term funding instruments to optimise cash flow and refinancing strategies.
Financial services, agribusiness and fintechs deepen participation
Beyond the dominant issuers, financial services firms, agribusinesses and mid-sized corporates recorded steady participation.
Payaza Africa Limited raised nearly ₦43 billion across three series under its ₦50 billion programme, making it one of the most active non-industrial issuers. Golden Fertilizer Company Limited issued ₦20 billion from a ₦40 billion programme, while Skymark Partners Limited raised just over ₦11 billion under a similar approval size.
Other issuers, including Champion Breweries Plc, Valency Agro Nigeria Limited, Neveah United Capital Plc and several special-purpose vehicles, contributed smaller but consistent volumes to overall issuance.
Rising rates drive shift to short-term funding
Analysts attribute the surge in CP activity to elevated borrowing costs in the banking system, driven by a high benchmark Monetary Policy Rate of 27 per cent. Commercial banks typically price loans above the policy rate to account for risk and operating costs, pushing effective lending rates higher for corporates.
While firms with strong credit profiles may secure relatively favourable terms, smaller or riskier borrowers face steeper costs, prompting increased use of commercial papers as a cheaper and more flexible funding alternative.
Across issuers, CP maturities were largely clustered between December 2025 and mid-2026, reinforcing their role as short-term liquidity tools rather than substitutes for long-term bank financing.
Market watchers note that the strong pipeline of approved but undrawn programmes suggests issuance activity could remain elevated into 2026, particularly if interest rates stay high and access to long-term credit remains constrained.
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