Nigeria’s total debt service has risen sharply in recent years, with a significant portion of the increase occurring under the administration of President Bola Ahmed Tinubu, as debt obligations surged to N16.26 trillion in 2025 from N7.79 trillion in 2023.
Since Q3 2023, when the current administration took office, quarterly debt service has remained elevated, peaking at a record N4.86 trillion in Q4 2025.
This is based on data released by the Debt Management Office (DMO).
On a quarterly basis, the upward trend peaked in Q4 2025, with debt service hitting a record N4.86 trillion. This was 37.86% higher than N3.52 trillion in Q3 2025 and 49.93% above N3.24 trillion in Q4 2024, showing a steady rise in debt payments.
What the data is saying
A comparison of Nigeria’s debt service trajectory before and during the Tinubu administration shows a clear structural shift in Nigeria’s debt service trajectory.
Pre Tinubu’s Administration (Q3 2019 – Q2 2023)
Quarterly debt service ranged between N330.82 billion and N1.24 trillion
Most quarterly payments ranged between N400 billion – N900 billion, averaging at N753.05 billion
External debt service remained relatively low, averaging N203.41 billion
During Tinubu’s administration (Q3 2023 – till date)
Quarterly debt service jumped sharply to a new range of N2.46 trillion to N4.86 trillion
The average rose to N3.47 trillion per quarter
External debt service surged into the trillion-naira range, exceeding N1 trillion across all quarters except Q4 2023, and peaking at N2.57 trillion in Q4 2025
The major turning point came in Q3 2023, when external debt service surged by 270.78%
quarter-on-quarter, driving a 234.78% increase in total debt service. This marked a clear shift from earlier trends and set the stage for the elevated debt service levels observed since then.
More Insight
Following the Q3 surge, total quarterly debt service remained consistently above N2 trillion and subsequently rose past the N3 trillion and N4 trillion thresholds
External debt has played a central role in this shift. In Q4 2025, external debt service stood at N2.57 trillion compared to N2.28 trillion for domestic debt, pushing external debt’s share to 53%, up from 43% in Q3 2025.
Exchange rate movements also amplified the trend, with the naira moving from N755.27/$ in Q3 2023 to N1,429/$ in Q4 2025. However, the Q4 2025 debt repayment spike occurred despite the naira appreciating to N1,429/$ from N1,478/$ in the previous quarter.
This indicates that the increase was driven by repayment volume rather than by exchange rate pressure.
What this means
The sustained rise in debt service since Q3 2023 highlights growing fiscal pressure, with an increasing share of government resources being allocated to debt obligations.
In 2024, total federal government revenue stood at N20.98 trillion, according to the federal government budget outturn, while total debt service, based on quarterly data, was N12.74 trillion.
This implies a debt service-to-revenue ratio of about 60.73%. This analysis is from the 2026 – 2028 Medium Term Expenditure Framework and Fiscal strategy Paper (MTEF & FSP) from the Budget Office of the Federation (BOF).
In the same year, total government expenditure was N34.49 trillion, meaning debt service accounted for 36.94% of total spending.
In 2025, between January and July, the federal government generated N13.67 trillion in revenue and spent N20.40 trillion in total expenditure. When annualised, revenue is estimated at N23.43 trillion compared to debt service of N16.26 trillion.
This implies that Nigeria is spending N6.94 out of every N10, or 69.41%, of its earnings on debt service in 2025, highlighting the growing strain on fiscal sustainability and limiting the government’s ability to fund growth-enhancing investments.
The rising dominance of external debt also adds another layer of risk, as repayments require foreign exchange, which will in turn increase the economy’s exposure to global financial conditions.
What you should know
The comparison between Q3 2019–Q2 2023 and Q3 2023–Q4 2025 highlights a clear regime shift in Nigeria’s debt service dynamics.
Before Q3 2023:
Debt service was relatively stable
External obligations were moderate
Quarterly payments were mostly below N1 trillion
After Q3 2023:
Debt service moved to a structurally higher level
External debt constituted a relatively larger share of total public debt
Quarterly payments consistently exceeded N2 trillion
The consistency of high debt service levels since Q3 2023 indicates that the increase has become structural rather than temporary.
THE GUARDIAN
