Consumer Loan Demand Surges 43 Points as Nigerians Borrow More

Demand for consumer loans by Nigerian households rose sharply by 42.9 index points in the third quarter of 2026, as demand for overdrafts, personal loans and housing finance also increased.

The Central Bank of Nigeria (CBN), in its Credit Conditions Survey Report for the third quarter, showed that consumer loans recorded the highest increase among the household lending categories, followed by credit for house purchases, which rose by 28.0 index points.

Demand for overdrafts and personal loans also increased by 24.7 index points, while mortgage and remortgage lending rose by 12.0 points during the period.

The report, however, showed a decline in household demand for credit card lending, which fell by 20.0 index points.

The CBN stated that “Respondent banks reported increase in credit demand across secured credit (including all its lending types), unsecured (including all its types) and all corporate lending types in Q3 2026.”

The increase in household borrowing demand was accompanied by higher demand for corporate credit, particularly among small, medium-sized and large businesses.

According to the report, lending to small businesses increased by 22.6 index points, while demand from large private non-financial corporations rose by 20.7 points. Medium-sized private non-financial corporations recorded an 18.3-point increase.

However, credit demand from other financial corporations declined by 16.2 index points, while lending to small businesses by households fell by 19.7 points.

The report also identified inventory financing as the leading factor driving increased demand for corporate lending, with an index reading of 18.6 points. This was followed by balance-sheet restructuring at 2.5 points and capital investment at 0.7 points.

On the supply side, banks reported increased credit availability across secured, unsecured and corporate lending categories in the third quarter.

The report stated that “Lenders indicated increase in overall credit availability in Q3 2026 across secured, unsecured and the corporate lending types.”

It attributed the increase in secured credit availability to changes in the economic outlook, liquidity positions and market share objectives.

For unsecured credit, the major drivers included market share objectives, changes in the economic outlook and the cost and availability of funds, while increased corporate credit availability was linked to lenders’ risk appetite, sector-specific risks and market share objectives.

The survey further showed that the proportion of loan approvals increased across secured, unsecured and corporate lending compared with the preceding quarter.

Despite the increase in credit availability, the spread between secured lending rates and the Monetary Policy Rate (MPR) widened to -14.5 index points.

Spreads also widened across corporate lending categories, reaching -13.6 index points for medium-sized businesses, -12.2 points for other financial corporations, -11.0 points for small businesses and -10.3 points for large businesses.

The spread on unsecured lending remained unchanged. The report also recorded lower default rates across secured, unsecured and corporate lending categories in the third quarter.