Nigeria’s net domestic credit drops to N99.4 trillion in January 2025 – CBN 

This was disclosed in the latest Money and Credit Statistics report by the Central Bank of Nigeria (CBN).

The data further revealed that net domestic credit in January 2024 stood at N99.99 trillion, while in November 2023, it was N85.35 trillion, underscoring the fluctuations in domestic lending within the past year.

However, the CBN did not provide figures for December 2024, leaving a crucial gap in understanding credit movement during the peak holiday spending period.

A review of historical data shows the following trends: 

The sharp decline from N115.58 trillion in November 2024 to N99.41 trillion in January 2025 suggests a contraction in domestic credit issuance, potentially due to tightening monetary policies by the apex bank or reduced borrowing demand across sectors.

While the CBN report does not explicitly explain the reasons behind the decline, several factors could have contributed:

At the 299th MPC meeting, the CBN retained the interest rate, at 27.50%.

“The impact is that it will bring some relief to businesses, especially those that are already indebted to banks. At least, interest rates are not increasing further,” Yusuf noted.

However, the desire of many businesses is that the rate should be reduced. It is not just about pausing the rate but actually decreasing it because servicing loans at nearly 30% interest is excruciating, burdensome, and outrageous.

“Those who are already indebted are the worst hit because they cannot walk away from the loan. Fresh borrowers can choose whether or not to take a loan, but existing debtors are stuck. We hope that at the next MPC meeting, there will be some relaxation of these rates. We want to see a drop in the MPR and the Cash Reserve Ratio (CRR),” he added.

A contraction in net domestic credit could signal reduced liquidity in the economy, affecting investment, business expansion, and consumer spending.

Net domestic credit is the total amount of credit that the financial sector provides to the economy. It includes credit to the private sector, the non-financial public sector, and other accounts.