New debt data shows integration of idle private balances into public financing, sparking debate over transparency and trust…..
Nigeria’s domestic debt profile has taken an unusual turn, with fresh data revealing that the Federal Government raised N100 billion by leveraging unclaimed private funds, marking a quiet but significant shift in how public borrowing is structured.
Figures released by the Debt Management Office (DMO) show that the instrument labelled “UFTF FGN Security” stood at N100 billion as of December 31, 2025. While this represents just 0.12 per cent of the country’s total domestic debt, it signals the formal entry of dormant and unclaimed funds into Nigeria’s borrowing framework.
Overall, the Federal Government’s domestic debt stock climbed to N80.49 trillion, with traditional instruments still dominating the landscape. FGN Bonds accounted for the bulk at N63.63 trillion, representing over 79 per cent of total debt. Treasury Bills followed at N13.85 trillion, underscoring their continued role in short-term financing.
Other instruments made up smaller portions of the debt mix. Promissory Notes stood at N1.54 trillion, while Sukuk bonds accounted for N1.19 trillion. Savings Bonds and Green Bonds contributed only marginal shares.
Against this backdrop, the N100 billion sourced through the Unclaimed Funds Trust Fund (UFTF) may appear modest in scale, but its implications are far-reaching. Unlike conventional borrowing, these funds originate from unclaimed dividends and dormant bank account balances, money that technically belongs to individuals and corporate entities.
The legal foundation for this structure dates back to the Finance Act 2020, which created a pathway for pooling idle financial assets into a central fund. Under the framework, dividends from listed companies that remain unclaimed, along with long-inactive bank balances, are transferred into the UFTF after a specified period.
The system is jointly managed by the DMO, the Central Bank of Nigeria (CBN), and the Securities and Exchange Commission (SEC). Once pooled, these funds can be invested in Federal Government securities effectively transforming dormant private assets into a source of public financing.
This explains the appearance of the UFTF instrument in the latest debt data. It is not merely a holding account but an active component of the government’s borrowing strategy.
Regulatory guidelines maintain that the original owners of these funds are not stripped of their rights. Beneficiaries can still reclaim both the principal and any accrued returns once they come forward within the stipulated timeframe. Banks are also required to publicly disclose dormant balances, a move aimed at improving transparency while drawing attention to the scale of idle funds within the financial system.
Still, the policy has not gone unchallenged. Critics, including civil society groups and market participants, argue that repurposing private funds for government borrowing raises serious concerns around governance, consent, and public trust.
While the government frames the initiative as a way to unlock idle capital and support fiscal needs without increasing traditional debt burdens, the long-term implications both for financial system confidence and investor behaviour remain a subject of growing debate.
