How an Average Nigerian can invest in Government Bonds or Treasury Bills

Understand the Difference between FGN Bond and Treasury Bills

FGN Bonds are debt securities (liabilities) of the Federal Government of Nigeria (FGN) issued by the Debt Management Office (DMO) for and on behalf of the Federal Government. Meanwhile, These are short-term securities issued at a discount for a tenor ranging from 91 to 364 days.

The main difference between the two is the maturity term. While Treasury Bills have maturities of up to 1 year, Government Bonds are investment instruments that have maturities of more than 1 year.

Why You Should Invest in FGN Bond or Treasury Bills

Apart from bonds and treasury bills being tax free, they are high and stable in terms of return with easy tradability in the Nigerian Stock Exchange and can also be traded over the counter (OTC). Furthermore, anyone can invest in FGN Bond or Treasury Bills

How do I invest in FGN Bonds?

Purchase of FGN Bond can be carried out through a Primary Dealer/market maker (PD/MMs). PD/MMs consists of  banks, investment houses or brokers. . To invest you approach your chosen PD/MMs and fill a form. In the form you fill your Personal Information, bank details for payment of your interest, CSCS nos, the amount you wish to invest, your bid interest rate and then sign. You can invest a minimum of N10,000 and multiples of N1,000 thereafter.

How to invest in Treasury Bills

Treasury bills are under the control of financial institutions (banks or stockbrokers). Investing in treasury bills will require filling out a form with your personal information with the amount you are willing to invest as well as your bid rate. Mostly, the minimum amount of treasury bills you can buy depends on the dealer.

You can buy your treasury bills from any official dealer or mobile application. These dealers or brokers are licensed by the Central Bank of Nigeria to purchase treasury bills, and you have to buy through them.