Q: What are treasury bills?

Treasury Bills (T-Bills) are short-term debt instruments issued by the Federal Government of any country through its Central Bank to raise short-term funds from the public (private individuals, institutional investors, non-governmental organisations, religious bodies etc.) for the purpose of financing government budget deficit. In Nigeria, T-Bills are issued by the Central Bank of Nigeria (CBN) and it is guaranteed and backed with the full faith of the Federal Government of Nigeria. T-bills are issued at an interest rate often referred to as a discount rate.