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The Central Bank of Nigeria (CBN) has relaxed restrictions governing financial institutions’ access to its Discount Window, allowing institutions that participate in the foreign exchange market and primary government securities auctions to continue accessing central bank liquidity facilities.
The new framework, announced in a circular dated August 12, 2026, is aimed at improving liquidity management and strengthening the functioning of Nigeria’s foreign exchange, money and fixed-income markets. The directives took immediate effect.
FX Market Participation No Longer Blocks Discount Window Access
Under the revised rules, financial institutions participating in the Nigerian Foreign Exchange Market (NFEM) will no longer lose access to the CBN’s Discount Window as a result of their FX market activities.
The Discount Window provides eligible financial institutions with access to liquidity from the central bank, including through facilities such as the Standing Lending Facility (SLF).
The CBN said the change followed a review of developments and practices in the foreign exchange, money and fixed-income markets, as well as the frameworks governing its liquidity and monetary policy operations.
Government Securities Auctions Also Get Relief
The same relaxation now applies to institutions participating in primary auctions of government securities.
Previously, successful participants in government securities auctions faced restrictions on accessing the Discount Window on settlement dates.
The revised framework removes that restriction, allowing institutions to participate in primary government securities auctions without automatically losing access to the central bank’s liquidity facilities.
The change could give banks and other eligible institutions greater flexibility in managing liquidity around their participation in the domestic debt market.
OMO Restriction Remains
While the CBN has relaxed the rules for FX transactions and government securities, it has retained a restriction relating to Open Market Operations (OMO).
Institutions that access the Discount Window will still be prohibited from participating in an OMO auction on the same day.
This creates a differentiated framework in which participation in the NFEM and primary government securities market does not prevent access to the Discount Window, while the same-day restriction remains applicable to OMO transactions.
CBN Restores Tenored Repo Operations
The apex bank also lifted the suspension of Tenored Repurchase Operations (Repos).
Under the revised framework, the CBN can conduct repo transactions with approved maturities ranging from four to 90 days.
The central bank said the measure is intended to support effective liquidity management, improve money-market operations and strengthen the implementation of monetary policy.
The restoration gives the CBN another instrument for managing liquidity conditions within the financial system.
OMO Securities Access Expanded
Another major adjustment is the expansion of access to OMO securities.
The CBN has opened participation to individuals, corporates and non-bank financial institutions, broadening the pool of potential investors in the central bank’s securities market.
The move could deepen participation in the domestic fixed-income market while providing a wider range of investors with access to CBN-issued securities.
What the Changes Mean for the Financial Market
The latest reforms effectively separate participation in key financial markets from access to emergency and short-term liquidity support.
For banks and other eligible financial institutions, the removal of restrictions tied to FX and primary government securities transactions could provide greater flexibility when managing liquidity and investment positions.
At the same time, the CBN’s decision to retain the OMO restriction indicates that the regulator still intends to maintain safeguards around its open-market operations.
The measures form part of the central bank’s broader effort to improve liquidity management and strengthen the efficiency of Nigeria’s financial markets as it continues implementing monetary and foreign exchange reforms.
