If you're leaving money in a savings account earning 8–12% while inflation runs at 30%, you are losing purchasing power every month. Money market funds offer 18–22% p.a. in 2026 — with near-instant liquidity, SEC regulation, and a 30-year track record of zero principal losses in Nigeria. Yet most Nigerians have never heard of them.
- Average commercial bank savings rate: 8–12% p.a.
- Average money market fund return: 18–22% p.a.
- On ₦1,000,000 over 12 months: savings account earns ₦100,000 vs MMF earns ₦200,000
- Same liquidity profile — both accessible within a few days
- SEC-regulated — cannot be invested in speculative or illegal schemes
Top Money Market Funds in Nigeria — May 2026
| Fund | Manager | 12-Month Return | Min Investment | Liquidity | Access Platform |
|---|---|---|---|---|---|
| ARM Money Market Fund | ARM Investment Managers | 20–21% p.a. | ₦5,000 | T+1 | ARM app / Cowrywise |
| Stanbic IBTC MMF | Stanbic IBTC Asset Mgmt | 18–19% p.a. | ₦10,000 | T+2 | Stanbic IBTC app |
| Cowrywise MMF | Cowrywise (via fund managers) | 20–22% p.a. | ₦100 | T+3 | Cowrywise app |
| United Capital MMF | United Capital AM | 19–20% p.a. | ₦5,000 | T+1 | UCap app |
| Meristem MMF | Meristem Asset Mgmt | 18–20% p.a. | ₦5,000 | T+2 | Meristem app |
| FSDH Merchant Bank MMF | FSDH Asset Mgmt | 19–21% p.a. | ₦10,000 | T+1 | FSDH app |
| Lotus Halal MMF | Lotus Capital | 17–19% p.a. | ₦5,000 | T+2 | Lotus app |
How a Money Market Fund Actually Works
When you invest in a money market fund, your money is pooled with that of thousands of other investors and deployed into a portfolio of short-term instruments. In Nigeria, approved MMF assets include: CBN 91-day and 182-day treasury bills (yielding 22–26% in 2026), commercial paper issued by companies like Dangote, MTN, and Nestlé (yielding 20–25%), and overnight lending to licensed banks (yielding 18–22%). The fund manager charges a management fee (typically 1–2% p.a.) — the yield you see is net of this fee.
Tax Treatment of Money Market Fund Returns in Nigeria
Interest income from money market funds is subject to 10% withholding tax (WHT) in Nigeria, which is deducted at source before you receive your returns. This means a fund earning 22% gross will deliver approximately 19.8% net of WHT. Capital gains from MMF units are currently exempt from capital gains tax in Nigeria, as MMF units are treated as fixed income instruments under SEC rules.
- Anyone with an emergency fund sitting in a low-yield savings account
- Businesses holding working capital — MMFs beat corporate savings accounts by 8–10%
- Investors who want fixed-income-like safety without the illiquidity of fixed deposits
- Anyone between investments who wants their money working while they decide next steps
- Retirees or risk-averse investors who cannot afford to lose principal
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Disclaimer: CompareMarket NG is an independent comparison service. Information is verified against regulatory databases (NAICOM, CBN, FCCPC, NDIC, NERC, NCC) and updated regularly, but rates and products change frequently. Always verify current terms directly with the provider before making a financial decision. This is not financial advice.
