Nigerian banks increased credit availability and recorded stronger demand for loans across secured, unsecured and corporate lending categories in the third quarter (Q3) of 2026, according to the Central Bank of Nigeria (CBN).
The development was contained in the apex bank’s Q3 2026 Credit Conditions Survey, which also showed higher loan approval rates and lower default rates across several major lending categories.
The survey showed that demand for secured credit rose to an index of 25.6, driven largely by increased demand for consumer loans, house-purchase financing and mortgage or re-mortgage lending.
Demand for unsecured credit also increased, with an index of 7.2, while corporate credit demand stood at 18.9.
Within the corporate segment, demand rose among small businesses, medium-sized private non-financial corporations and large private non-financial corporations, with indices of 22.6, 18.3 and 20.7 respectively.
However, lending to households for small businesses and credit-card lending declined, while credit demand from other financial corporations also fell.
Inventory financing drives corporate borrowing
The CBN said inventory financing was the strongest factor behind the increase in corporate credit demand, recording an index of 18.6.
Balance-sheet restructuring and capital investment also contributed, with indices of 2.5 and 0.7 respectively.
The increase suggests that businesses are seeking additional bank financing to maintain inventories, restructure their financial positions and fund investment.
On the supply side, banks attributed increased availability of secured credit mainly to changing economic conditions, liquidity positions and market-share objectives.
For unsecured lending, market-share considerations, the economic outlook and changes in the cost and availability of funds were identified as major drivers.
In the corporate lending segment, changing risk appetite, sector-specific risks and market-share objectives supported increased credit availability.
Lending rates diverge from MPR
Despite the increase in credit availability, the survey showed that the gap between lending rates and the Monetary Policy Rate (MPR) widened across secured and corporate lending during the quarter.
The spread for secured lending widened to -14.5 index points.
For corporate borrowers, the spread stood at -13.6 points for medium-sized private non-financial corporations, -12.2 points for other financial corporations, -11.0 points for small businesses and -10.3 points for large private non-financial corporations.
The spread for unsecured lending, however, remained unchanged.
The findings came after the CBN cut the MPR by 350 basis points to 23 per cent in September 2026.
Meanwhile, the survey reported lower default rates across secured, unsecured and corporate lending categories, including small businesses, medium and large private non-financial corporations and other financial corporations.
The latest findings point to an expansion in bank credit at a time when households and businesses are showing stronger appetite for borrowing, although the continued divergence between lending rates and the policy benchmark remains a constraint on access to affordable credit.
