Nigeria’s outstanding consumer credit fell by 19.89 per cent to N3.78 trillion in 2025, marking its first annual decline in six years as high interest rates weakened household borrowing.

Similarly, the banking industry’s fraud watchlist expanded by 38.4 per cent during the year, with the number of bank verification numbers (BVNs) flagged for fraud rising to 13,117 from 9,476 in 2024, reflecting stronger fraud monitoring by financial institutions.

The Central Bank of Nigeria (CBN) disclosed these in its 2025 Annual Report and Statement of Accounts. It said consumer credit declined from N4.72 trillion recorded in the preceding year due to the prevailing high-interest rate environment, while the increase in flagged BVNs reflected improvements in fraud monitoring and resolution across the banking sector.

According to the report, the contraction in consumer credit was driven largely by a sharp decline in personal loans, although retail lending recorded strong growth and became the dominant component of outstanding consumer credit for the first time in many years.

The CBN said: “Consumer credit outstanding moderated, in response to the dynamic interest rate environment. Consumer credit outstanding fell by 19.89 per cent to N3,783.40 billion in 2025, from N4,722.93 billion in the preceding period. The fall was the first since December 2019.”

The report showed that personal loans declined to N1.85 trillion, while retail loans increased by 63.77 per cent to N1.94 trillion. As a result, retail loans accounted for 51.16 per cent of total consumer credit, while personal loans made up the remaining 48.84 per cent.

Consumer credit also accounted for a smaller share of lending to the private sector during the year. According to the CBN, it represented 6.6 per cent of total credit to the private sector provided by other depository corporations in 2025, down from 7.98 per cent in 2024.

The report also highlighted changes in banks’ lending portfolios. Short-term credit remained the largest component of the assets portfolio of other depository corporations, although its share declined by 7.71 percentage points to 51.6 per cent. Medium-term credit edged down by 0.11 percentage points to 13.46 per cent, while long-term credit increased by 7.82 percentage points to 34.94 per cent.

Explaining the trend, the CBN said: “The dominance of short-term loans and advances reflected banks’ preference for matching short-term lending with short-term deposit liabilities.”

It added that deposit liabilities with maturities of one year and below continued to dominate the portfolio of other depository corporations, rising slightly to 91 per cent in 2025 from 90.09 per cent in the previous year. Medium-term deposit liabilities increased to 5.15 per cent from 2.63 per cent, while long-term deposit liabilities declined to 3.85 per cent from 7.28 per cent.

On fraud monitoring, the report showed that financial institutions placed an additional 3,641 BVNs on the industry’s fraud watchlist during the year as part of broader improvements in compliance and risk management.

The CBN stated: “Fraud-related BVNs on the watchlist rose to 13,117 compared with 9,476 in the preceding period. This highlighted improvement in fraud monitoring and resolution.”

Another category that recorded a notable increase was deceased persons’ BVNs on the watchlist, which rose to 28,754 in 2025 from 21,118 a year earlier, reflecting efforts to update customer records and reduce opportunities for identity misuse within the financial system.

The report also showed continued growth in the BVN ecosystem. Registrations increased to 67.82 million in 2025 from 64.40 million in the previous year, adding 3.42 million new enrolments.

The number of bank accounts linked to BVNs rose to 368.92 million from 297.29 million, while active bank accounts increased to 339.26 million from 311.6 million.
According to the apex bank, the combined growth in enrolments, linked accounts and active accounts reflected sustained financial inclusion, stronger compliance and improved integrity of the BVN system.