The total amount of loans given to the Nigerian organized private sector by the banking industry rose to N43 trillion in the first three months (Q1) of 2023.
This is according to data obtained from the Central Bank of Nigeria (CBN)’s website. Credit to the private sector includes consumer loans, small business loans, commercial loans, structured finance, trade finance, mortgages, and all others issued to businesses and individuals.
Despite the CBN’s policies targeted at reducing the amount of cash in circulation, commercial banks have rather stepped up their lending to the sector to create more wealth and help the sector expand its capacity.
The CBN had raised interest rates in the last five monetary policy meetings, citing galloping inflation and the need to contain money supply. However, data for March 2023 suggests that financial institutions gave out more credit to the private sector in the month under review. For instance, loans issued to the private sector increased by N1.3 trillion to reach N43 trillion in Q1 2023.
In contrast, total credit to the government fell slightly from N28.4 trillion to N27.5 trillion or N900 billion. This is also the second-largest drop in credit to the private sector since 2020. – Source: The Sun
