In 2025, the NGX Money Market Mutual Fund sector experienced significant growth in net asset value (NAV), although average yields softened compared to the previous year.
This is according to the Securities and Exchange Commission (SEC) valuation reports for collective investment schemes for January 3 and December 24, 2025.
The market saw its NAV increase by 182%, rising from N1.68 trillion in 2024 to N4.74 trillion in 2025, reflecting growing investor confidence in low-risk, short-term investment vehicles.
Alongside this NAV increase, the number of unit holders grew from 353,940 in 2024 to 597,901 in 2025, demonstrating that more investors are turning to money market funds as a safe and liquid investment option.
However, despite the growth in assets, the average yield of all the funds decreased from 21.24% in 2024 to 17.19% in 2025, reflecting the impact of changes in CBN monetary policy rate.
While these shifts reflect a growing interest in MMMFs, the decrease in yield signals that investors experienced slightly lower returns in the short term.
The combination of higher NAV and softer yields suggests that investors have opted to lock down funds in short-term, relatively secure assets—particularly in comparison to riskier asset classes like equities and long-term bonds.
However, the 2026 outlook will still largely depend on shifts in key variables, such as market conditions, macroeconomic trends, and evolving government policies.
With that in mind, let’s take a closer look at what money market mutual funds are and how they work.
What is a money market mutual fund (MMMF)?
To better understand the dynamics of this market, let’s first dive into what a Money Market Mutual Fund (MMMF) is and how it works.
A money market mutual fund is a type of collective investment scheme (CIS) that primarily invests in short-term, low-risk, high-liquidity instruments such as Treasury bills, commercial papers, and certificates of deposit.
Investing in MMMFs offers security at a modest return. While the principal amount is secure, the interest income accrued from your investment may fluctuate depending on market interest rates.
For example, if you invest N5 million in any of the SEC’s listed 44 Money market mutual funds, that N5 million remains secure.
What fluctuates is the interest you earn from the N5 million, which could increase or decrease depending on the prevailing market conditions, such as Treasury bill rates, OMO bills, commercial papers, and bank placements/repos.
If, for instance, T-bill stop rates fall at auction, you may see a softening in money market fund yields, even if fund managers are working to maintain strong returns.
MMMFs are particularly popular among conservative investors who prioritize capital security and those seeking liquidity.
With these key factors in mind, let’s now turn to insights from the SEC reports, which provide further context on the current state of the money market funds and how regulatory changes might impact the market moving forward.
Insights from the SEC Valuation Reports
As of December 2025, money market mutual funds accounted for over 62% of the total mutual funds’ assets, reflecting their strong position in the market.
Leading managers such as Stanbic IBTC, First Asset Management, ARM Investment Managers Limited, Guaranty Trust Manager Limited, and United Capital Asset Management Limited continue to dominate the sector, managing over 80% of the total money market mutual fund NAV.
Stanbic IBTC Money Market Fund stood out, managing nearly 49% (N2.3 trillion) of the total NAV with a yield of 16.14%.
Despite its smaller size, the RT Briscoe savings and investment fund, managed by DLM Asset Management Limited, offered the highest yield at 24% YtD, although it had an NAV of only N72 million and just 23 unit holders.
The size and performance of a fund, along with its outlook, are crucial factors to consider when selecting the right money market mutual fund.
Additionally, new regulations from the SEC will influence the way money market funds operate in 2026.
According to the SEC’s revised circular, the capital requirements for Tier 1 Portfolio Managers (Full Scope) will increase from N150 million to N5 billion.
- Furthermore, money market fund managers must maintain 0.1% of their Assets Under Management (AUM) as part of their capital base.
For larger funds such as Stanbic IBTC, FBN, and ARM, which already hold substantial assets, meeting these new capital thresholds will not be difficult.
Outlook for 2026: Key considerations for investors
One of the most significant factors to watch in 2026 is the shift in the CBN’s Monetary Policy Rate (MPR), as this will undoubtedly influence yields.
Last year, the average yield was higher than the inflation rate, providing investors with a positive real return.
However, if the MPR changes, we can expect corresponding shifts in yields, which will impact the returns investors can expect from money market funds.
Despite these fluctuations, money market funds in 2026 will still remain an essential asset class, offering stability and growth potential, even as the funds adjust to the evolving regulatory landscape.
The ability of these funds to meet new regulatory requirements, along with the resilience of their financial structures, will be crucial for investors as they navigate the market in the coming year.
Overall, by staying ahead of these developments, investors can navigate the evolving market and continue to make informed, secure investment decisions.
