Credit to private sector declines to N73.66 trillion in February 2025 – CBN 

This is according to data released by the Central Bank of Nigeria (CBN).

The latest figures from the apex bank show a downward trend in credit extension, with private sector loans decreasing from N74.92 trillion in January 2025 and N75.96 trillion in December 2024.

The data indicates a significant year-on-year contraction, with private sector credit falling by approximately N7.2 trillion (8.9%) compared to February 2024.

This represents a cumulative decline of approximately N2.3 trillion, showing that there has been a steady decline over the past three months:

This moderation in credit seems to align with the CBN’s ongoing stringent monetary policies under Governor Yemi Cardoso, aimed at curbing inflation and stabilizing the economy.

Some analysts attribute the reduction in credit to a combination of factors, including tighter monetary policies by the CBN aimed at controlling inflation, increased interest rates, and cautious lending by commercial banks due to rising default risks.

Additionally, uncertainty in the business environment, foreign exchange volatility, and sluggish economic growth have further dampened private sector borrowing.

The decline in private sector credit could have significant implications for economic growth, as reduced access to funding may constrain business expansion, job creation, and investment in key sectors such as manufacturing, agriculture, and technology.

Small and medium-sized enterprises (SMEs), which rely heavily on bank loans for working capital, could be particularly affected.

According to Bolaji Ojo, a financial expert based in Lagos, “prolonged credit contraction may slow down economic activities and undermine efforts to stimulate growth and investment.

“The private sector remains a critical driver of economic development, and sustained credit support is essential for fostering innovation, improving productivity, and enhancing competitiveness,” he noted.