Personal loans hit N1.96tn in January 2026, accounting for more than half of Nigeria’s consumer credit, according to the CBN

Personal loans granted by Nigerian banks rose to N1.96tn in January 2026, accounting for more than half of the country’s total consumer credit, according to the latest Economic Report released by the Central Bank of Nigeria.

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The report showed that total consumer credit outstanding increased by 0.79 per cent to N3.81tn in January from N3.78tn recorded in December 2025, with growth driven entirely by a rise in personal lending.

According to the apex bank, personal loans increased by 5.95 per cent from N1.85tn to N1.96tn during the review period, representing 51.44 per cent of total consumer credit.

The Personal Loans Hit N1.96tn milestone highlights growing demand for individual borrowing despite prevailing high interest rates and tight monetary conditions.

In contrast, retail loans declined by 4.15 per cent to N1.85tn from N1.93tn in December, accounting for the remaining 48.56 per cent of total consumer credit.

The report also revealed modest growth in overall credit to the economy. Total bank lending rose by 0.17 per cent to N57.41tn in January from N57.32tn in the preceding month.

The Central Bank attributed the increase mainly to stronger lending to the services and agriculture sectors.

Credit to the services sector rose by 0.12 per cent, while lending to agriculture increased by 2.77 per cent. However, credit to the industrial sector declined by 0.24 per cent.

Sectoral data showed that services remained the largest recipient of bank credit, accounting for 56.98 per cent of total lending. Industry represented 36.55 per cent, while agriculture accounted for 6.47 per cent.

Agricultural credit increased to N3.81tn in January from N3.71tn in December. Lending to the services sector rose to N32.86tn from N32.71tn, while credit to industry stood at N21.21tn.

Within the services sector, finance, insurance and capital market activities attracted N9.16tn in credit facilities. Trade and general commerce received N5.54tn.

Manufacturing remained the largest component of industrial lending, accounting for N6.37tn. The power and energy sector received N1.59tn, while construction attracted N2.44tn.

The report further indicated that broad money supply contracted by 1.50 per cent during the month, reflecting tighter liquidity conditions and a reduction in net foreign assets.

Despite the contraction in money supply, the CBN said the banking sector remained resilient, with prudential indicators staying within regulatory limits.

Speaking after the 305th meeting of the Monetary Policy Committee, CBN Governor Olayemi Cardoso said lending to small and medium-sized enterprises had shown encouraging improvement.

According to Cardoso, new credit to SMEs increased to about N199bn in April 2026 from N153bn in March, particularly within the retail segment of the market.

He noted that the general category accounted for 94.73 per cent of new SME credit facilities, while general commerce represented 2.46 per cent.

Cardoso stressed that supporting SMEs was a shared responsibility involving the Ministry of Industry, Trade and Investment, the Bank of Industry and fiscal authorities, with the CBN serving primarily as a catalyst for improving the lending environment.

The Monetary Policy Committee recently retained the benchmark interest rate at 26.5 per cent, citing inflationary pressures, external economic risks and the need to maintain exchange rate stability.

The decision came after Nigeria’s headline inflation increased for a second consecutive month to 15.69 per cent in April from 15.38 per cent in March, according to data from the National Bureau of Statistics.

Food inflation also rose to 16.06 per cent from 14.31 per cent, driven by higher transportation costs and seasonal pressures, while core inflation eased slightly to 15.86 per cent from 16.21 per cent.

Reacting to the MPC’s decision, President of the Association of Small Business Owners of Nigeria, Dr Femi Egbesola, urged policymakers to consider reducing interest rates at the next meeting.

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Egbesola argued that lower borrowing costs would improve access to finance for SMEs and help businesses already grappling with inflation, rising energy costs and broader economic challenges.