Demand for loans by businesses and households increased in the second quarter of 2026 as Nigerian banks expanded credit access while recording an improvement in loan repayment, according to the latest Credit Conditions Survey released by the Central Bank of Nigeria (CBN).
The survey indicated that lenders eased credit conditions across major lending segments, leading to stronger demand for corporate and secured loans and higher approval rates during the quarter.
According to the report, credit availability improved for secured lending, corporate lending and unsecured lending, reflecting banks’ growing willingness to extend financing as confidence in the economy strengthened.
The CBN said demand for secured loans rose to an index of 15.1 points, while corporate loan demand increased to 15.2 points. However, demand for unsecured loans remained subdued, posting an index of -1.2 points.
The report also showed that banks approved a larger proportion of loan applications during the quarter, signalling improved confidence in borrowers’ repayment capacity and a more favourable credit environment.
A key highlight of the survey was the decline in default rates across both household and corporate lending categories. Banks reported better loan performance for secured and unsecured household loans, as well as loans granted to small, medium and large businesses.
The apex bank attributed the improved credit conditions to stronger economic expectations, better risk assessment by lenders and increased competition among banks seeking to expand their loan portfolios.
Despite the easing of lending conditions, banks indicated that borrowing costs remained elevated, reflecting the impact of the CBN’s tight monetary policy aimed at containing inflation.
The findings suggest that Nigeria’s banking sector is gradually witnessing improved asset quality after a period of heightened credit risk, with stronger loan demand and lower default rates pointing to improving confidence among lenders and borrowers alike.
