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The short answer
Nigerian Treasury bill rates look several times higher than US Treasury bill rates, but a US-based investor earns the naira rate only if the naira holds its value against the dollar over the life of the bill. At the 7 October 2026 auction the 364-day Nigerian bill stopped at 15.85%; after 10% Nigerian withholding tax, a naira return of that size is wiped out if the naira weakens by roughly the same percentage over the year, and both bills are then subject to US federal tax.
The headline numbers
Nigeria's Debt Management Office sells naira Treasury bills through auctions run by the CBN. At the auction of 7 October 2026, Nairametrics reported stop rates of 15.50% for 91 days, 15.80% for 182 days and 15.85% for 364 days. Rates move with each auction; our guide to T-bill auction dates explains the calendar, and the Nigeria library covers how to read stop rates.
US Treasury bills are sold by the US Treasury in dollars. The current rates are on TreasuryDirect and in the Treasury's auction results; check them on the day, because they also move. For the comparison below we use a labelled example rate rather than a live one.
Three things stand between the two rates
- The exchange rate. You convert dollars to naira at the start and naira back to dollars at maturity. Any fall in the naira over that period comes straight off your dollar return.
- Nigerian withholding tax. The tax authority directed a 10% withholding tax on interest from short-term securities, including Treasury bills (Reuters via Bizcommunity, October 2025). Older guides that call T-bills tax-free are out of date; ask your dealer what it deducts.
- US tax. US citizens and residents are taxed on worldwide income (IRS Publication 54). Interest on US Treasury bills is taxable for federal income tax (IRS Publication 550). Nigerian interest must be reported in dollars at the exchange rate when it is received (IRS foreign currency page). There is no US-Nigeria tax treaty.
Worked example
Example only. Rates are illustrations, not forecasts. Chidi in Dallas has $10,000. He converts at ₦1,450 to the dollar, giving ₦14,500,000, and buys a one-year naira bill earning 15%.
| Step | Naira | Note |
|---|---|---|
| Invested | ₦14,500,000 | $10,000 at ₦1,450 |
| Interest at 15% | ₦2,175,000 | Example rate |
| Withholding tax at 10% | −₦217,500 | Deducted in Nigeria |
| At maturity | ₦16,457,500 | Net naira return 13.5% |
What that is worth in dollars depends on the rate a year later:
| Naira at maturity | Dollars back | Dollar return before US tax |
|---|---|---|
| ₦1,450 (unchanged) | $11,350 | +13.5% |
| ₦1,595 (10% weaker) | $10,318 | +3.2% |
| ₦1,740 (20% weaker) | $9,458 | −5.4% |
The break-even rate is ₦16,457,500 / $10,000 = ₦1,645.75. If the naira is weaker than that at maturity, Chidi would have done better in US dollars at any positive US rate. Put another way, his 13.5% net naira return gives him a cushion of 13.5% depreciation, no more.
Compare that with a US bill at an example 4%: $10,000 earns $400 with no currency risk, before federal tax. The Nigerian bill only wins if the naira holds within that cushion, less the 4% he gave up.
How much has the naira moved before?
History is not a forecast, but it sets expectations. Wikipedia's summary of Reuters and CBN figures records the naira at around ₦600 to the dollar after the June 2023 float, about ₦1,400 by early February 2024 and around ₦1,600 by late July 2024. The CBN official rate used by the DMO for its June 2026 debt figures was ₦1,379.18 (Nairametrics, September 2026), so the naira has also had periods of strengthening. Moves of more than 13.5% in a year have happened, and so have years where the naira gained. Check today's rate in your app before you convert, never an old figure.
The US tax wrinkle
Because the IRS works in dollars, the naira interest is converted at the rate on the day received, and any change in the dollar value of the principal between purchase and maturity can be a separate currency gain or loss. In the 20% weaker example, Chidi earned naira interest he must report while losing dollars overall. Ask a US accountant how that nets out on your return. A Nigerian account holding the bills can also count towards the FBAR and Form 8938 thresholds; see reporting T-bill income on Form 8938.
Shorter bills, more conversions
A 91-day bill rolled four times is not the same as one 364-day bill. Each rollover is reinvested at whatever the next auction pays, which may be higher or lower, and if you bring the money back to dollars between rolls you pay the conversion spread each time. Keeping the naira invested until a single final conversion limits that cost, though it leaves the full year of currency exposure in place. Our guide to managing T-bill rollovers from the US walks through the choices.
The spread on each conversion is a cost in its own right. If the rate you get is 1% worse than the mid-market rate in each direction, a round trip costs about 2% of the money, which comes off the cushion in the example above.
What to check first
- The latest stop rate for the tenor you want, and the date of that auction.
- Your dealer's minimum, fees and custody charge, and whether you can buy as a non-resident.
- What withholding tax will be deducted at maturity.
- The rate you will get converting in and out, including the spread.
- Whether you need the money back in dollars or will spend it in Nigeria anyway. If the naira is for a Lagos expense, the currency risk matters less.
Where Pryme fits
Pryme does not sell Treasury bills. A Pryme account holds USD and NGN separately, so you can keep dollars until you decide to convert; Swap shows the rate and the fee before you approve. For saving in naira for a set date, see the Savings Boxes, which are Naira-only and held in Nigeria. Information only, not investment or tax advice.
Questions people ask
Are Nigerian T-bills better than US T-bills?
Only if the naira does not fall by more than your net naira return over the bill's life. A 13.5% net naira return is cancelled by roughly 13.5% depreciation.
Are Nigerian Treasury bills tax-free?
Not any more. A 10% withholding tax on interest from short-term securities, including T-bills, was directed in 2025. Ask your dealer what it deducts.
Do I pay US tax on Nigerian T-bill interest?
US citizens and residents are taxed on worldwide income, so yes, the interest is reported in dollars at the rate when received. Ask an accountant about currency gains and losses.
What is the current Nigerian T-bill rate?
It changes at each auction. On 7 October 2026 the 364-day stop rate was 15.85%. Check the latest DMO or CBN auction result.
Sources
- Nairametrics: DMO raises N968.47 billion as 364-day stop rate falls to 15.85% (7 Oct 2026) · accessed Oct 2026
- Bizcommunity (Reuters): Nigeria to impose 10% withholding tax on interest on short-term securities (29 Oct 2025) · accessed Oct 2026
- IRS: Publication 54, Tax guide for US citizens and resident aliens abroad (Rev. 12/2025) · accessed Oct 2026
- IRS: Publication 550, Investment income and expenses (2025) · accessed Oct 2026
- IRS: Foreign currency and currency exchange rates · accessed Oct 2026
- Wikipedia: Nigerian naira, exchange-rate history (secondary, citing Reuters and CBN) · accessed Oct 2026
This article is general information, not financial, legal or tax advice. Products described are provided under the terms on this site and are subject to regulation and eligibility.