•Interest payments, rentals gulp N4.95trn
By Adewale Sanyaolu and Adanna Nnamani, Abuja
The Federal Government spent N5.28 trillion servicing domestic debt obligations in the first half of 2026, with interest and rental payments accounting for N4.95 trillion, underscoring the growing pressure of debt servicing on public finances.
Data released by the Debt Management Office (DMO) on Thursday showed that the government also repaid N333.96 billion in principal on promissory notes between January and June.
The figures highlight the substantial cost of domestic borrowing at a time the government faces competing demands for infrastructure development, public services and other expenditure priorities.
An analysis of the DMO’s actual domestic debt service figures showed that Federal Government bonds and Nigerian Treasury Bills (NTBs) accounted for the bulk of interest payments during the six-month period.
Interest payments on Federal Government bonds amounted to N3.35 trillion, while Treasury Bills attracted N1.49 trillion.
Monthly payments on Federal Government bonds fluctuated significantly during the period, rising from N462.44 billion in January to N707.25 billion in February before peaking at N792.34 billion in March.
The payments subsequently declined to N530.84 billion in April and N332.49 billion in May before climbing to N525.05 billion in June. For Treasury Bills, interest payments totalled N1.49 trillion, with March accounting for the highest monthly outlay of approximately N481.47 billion.
Other domestic debt instruments also contributed to the government’s interest burden. FGN Sukuk rentals amounted to N92.29 billion, while interest payments on FGN Savings Bonds stood at N8.90 billion. Green bond interest payments accounted for another N5.56 billion. The figures indicate that conventional bonds and Treasury Bills remained the principal drivers of the Federal Government’s domestic debt servicing costs in the first half of the year.
Beyond interest and rental payments, the government spent N333.96 billion on principal repayments for promissory notes, with disbursements concentrated in March and June.
Principal repayments reached N154.23 billion in March and N136.96 billion in June, reflecting the timing of repayment obligations during the period.
Of the total, N263.27 billion went towards local-currency-denominated promissory notes, while foreign-currency-denominated notes accounted for N70.69 billion.
A breakdown of monthly domestic debt service showed that March recorded the highest expenditure at N1.43 trillion, followed by February with N967.67 billion and June with N811.62 billion.
The government spent N765.19 billion in April and N741.82 billion in January, while May recorded the lowest monthly outlay at N567.16 billion.
The latest figures add to concerns over the rising share of public resources required to meet Nigeria’s debt obligations, potentially limiting the funds available for capital projects and other government priorities.
Nairametrics had previously reported that Nigeria incurred N10.61 trillion in additional debt-servicing costs between June 2023 and December 2025, exceeding the N6.47 trillion spent on strategic infrastructure development by N4.14 trillion over the same period.
The publication also reported that the Federal Government borrowed N11.9 trillion between June 2023 and December 2025, noting that economic reforms had created fiscal space and helped avert even higher borrowing.
Nigeria’s total debt-servicing costs rose to about N16 trillion in 2025, driven by higher domestic interest payments and continued obligations to external creditors.