- Nigerian Banks Report More Credit, but Private-Sector Lending Still Falls – CBN Survey
Nigerian banks reported that credit became more available and loan demand increased in the third quarter of 2026. Yet a separate measure of lending showed private-sector credit outstanding fell in September.
The contrast captures a central challenge for businesses: a willingness among banks to lend does not automatically mean that more credit is reaching the economy or becoming affordable.
The Central Bank of Nigeria’s Q3 Credit Conditions Survey found that banks reported increased credit availability across secured, unsecured and corporate lending. Loan demand also rose across all three broad categories, and banks said approval rates had increased compared with the previous quarter.
But the survey records lenders’ assessments of changes in credit conditions; its indices are not the amount of credit disbursed. Meanwhile, private-sector credit outstanding declined to N83.93 trillion in September from N84.47 trillion in August.
The survey points to improving sentiment among lenders and borrowers, while the credit-stock figures show that the broader lending total had not yet turned upward.
That distinction is essential to reading the findings. The CBN calculates survey results from lenders’ responses, weighted by their market shares.
The indices represent the balance between lenders reporting an increase and those reporting a decrease; they do not measure loan growth in naira.
The Bank also states that the survey reflects respondents’ views and does not necessarily represent its own assessment of credit conditions.
In the survey, corporate credit availability recorded an index of 24.3, unsecured credit 18.9 and secured credit 5.5. Demand indices were also positive: 25.6 for secured lending, 7.2 for unsecured lending and around 19 for corporate credit.
The slight variation in the corporate-demand figure across the report’s summary and narrative underscores that these are survey indicators, rather than direct measures of loan volumes.
The findings suggest that more lenders saw credit supply and demand moving upward during the quarter. They do not establish that every borrower gained access to finance, that loan sizes increased, or that the cost of borrowing fell.
Those distinctions matter in an economy where firms may need financing but still face high interest costs, collateral requirements or terms they cannot meet.
Household demand was strongest in secured consumer lending. The survey recorded an index of 42.9 for consumer loans and 28.0 for credit to households purchasing homes.
Mortgage and re-mortgage lending also rose, with an index of 12.0. But household lending to small businesses moved in the opposite direction, registering -19.7.
Within unsecured credit, overdrafts and personal loans to households increased, while credit-card lending declined, with an index of -20.0.
The pattern suggests that demand was not rising evenly across borrowing products. A broader increase in loan appetite can coexist with weaker demand in specific categories.
Corporate demand was recorded across small businesses, medium-sized and large private non-financial companies.The CBN survey attributed the increase mainly to inventory finance, which had an index of 18.6. Balance-sheet restructuring registered 2.5, while demand for capital investment recorded 0.7. Commercial real-estate demand declined, at -11.8.
That mix offers a clue to what businesses may be seeking credit for. Inventory finance can help firms purchase goods and maintain operations; balance-sheet restructuring may help them reorganise existing obligations.
The low index for capital-investment demand, however, suggests that the reported increase in borrowing interest was not being driven primarily by businesses financing new equipment or expansion. The figures are survey signals, not measures of how many firms borrowed for each purpose.
Approval rates increased across secured, unsecured and corporate lending, with the strongest survey reading in corporate loans.
But approval is only one step in the credit process. It does not show how many applicants received the full amount requested, whether they accepted the terms, or whether the loan was ultimately disbursed.
Pricing may be one reason that gap matters. The survey found that spreads between lending rates and the Monetary Policy Rate widened in secured and corporate lending categories.
The index for secured lending was -14.5, while corporate spreads were negative across small businesses, medium-sized and large companies, and other financial corporations. The unsecured spread remained unchanged.
These figures are reported in index points; they are not percentage-point margins or direct estimates of the interest rate charged to a borrower. Still, the survey’s direction indicates that lending rates were diverging further from the policy benchmark in several categories.
The CBN cut its Monetary Policy Rate by 350 basis points to 23.00% in September, but that reduction had not produced a corresponding easing in the survey’s secured and corporate lending-spread indicators.
The gap between the policy rate and borrowing costs is important for businesses deciding whether investment or expansion is viable.
A lower benchmark may help ease financial conditions over time, but banks also price loans for funding costs, borrower risk and other factors.
The survey does not provide the actual rates paid by individual borrowers, but it indicates that the policy cut was not passing through evenly across lending categories.
Banks also reported lower default rates across secured, unsecured and corporate lending in Q3. If sustained, that could support lenders’ willingness to extend credit.
But the survey is not a record of verified repayment performance across the whole economy; it captures banks’ reported assessments of changes in default conditions.
The broader lending figures offer a reminder that improved credit sentiment does not guarantee an immediate increase in outstanding loans. Private-sector credit fell between August and September, even as the Q3 survey pointed to higher availability, demand and approvals.
The indicators measure different things: one tracks banks’ reported changes in conditions, while the other records the value of credit outstanding at a point in time. Their divergence is not necessarily a contradiction, but it shows why the survey should not be treated as proof that lending has already accelerated.
For policymakers and businesses, the next test is whether the reported improvement becomes more credit reaching productive activity at terms borrowers can bear.
Rising demand and approvals would be more consequential if accompanied by stronger credit balances and greater access for firms seeking working capital and investment finance.
The Q3 survey offers a cautiously positive signal: lenders reported more willingness to extend credit and more interest from borrowers.
But the decline in private-sector credit and the widening loan-spread indices show that access, cost and actual disbursement remain separate tests.
For Nigerian businesses, the difference between a bank being more open to lending and a loan being affordable enough to use may still be decisive.
