Nigeria's Domestic Debt Service Jumps 20.3% to N3.14 Trillion in Q1 2026

Nigeria's federal government allocated N3.14 trillion to service its domestic debt in the first quarter of 2026. This figure represents a significant 20.3% increase compared to the same period in 2025, when N2.61 trillion was spent. The latest report from the Debt Management Office (DMO) highlights the growing financial strain caused by interest payments.

During the first quarter of 2026, interest payments alone consumed N2.97 trillion, constituting approximately 95% of the total domestic debt-service expenditure. This left only N169.68 billion for principal repayments. The total domestic debt-service bill also saw a sharp acceleration, rising 37.5% from N2.28 trillion in the fourth quarter of 2025.

Analysis of the DMO figures reveals a steady monthly increase in domestic debt-service payments throughout the quarter. Interest payments on Federal Government of Nigeria (FGN) bonds were the largest component, accounting for about N1.96 trillion. Nigerian Treasury Bills (NTBs) contributed another N1.003 trillion in interest payments. This trend indicates that for every N100 spent on domestic debt servicing, roughly N95 went towards interest.

The escalating domestic debt-service burden occurs as the federal government continues to rely heavily on the domestic debt market to finance budget deficits and meet its expenditure obligations. Nigeria's total public debt stock reached N159.35 trillion.