The Central Bank of Nigeria (CBN) has revealed an increase in consumer credit, with personal loans and retail loans rising by 14.3% and 4%, respectively, in January 2024.
CBN in a statement disclosed that the total consumer credit outstanding reached ₦3.823 billion in January 2024, indicating a 12% jump from the previous month.
CBN said consumer credit jumped by 12 per cent to approximately ₦3.9bn in January 2024, riding on the back of majorly heightened inflation.
The apex bank explained that a disaggregation of consumer credit revealed that personal loans increased by 14.3 per cent to N3,028bn from N2,649bn in December 2023.
Retail loans rose by 4 per cent to N795bn, as personal loans accounted for 79 per cent of consumer credit, while retail loans accounted for 21 per cent.
Consumer credit, as a share of total credit from Online Data Capture Systems (ODCs), fell to around 7 per cent, down from 8 per cent the previous month, according to the report.
The surge in demand for loans is attributed to the escalating cost of living, as Nigeria’s headline inflation rate hit 33.95 per cent in May, forcing the CBN to hike interest rates consecutively to 26.25 per cent.
A study by SBM Intelligence found that 27 per cent of Nigerians now resort to loan apps to keep up with living expenses, indicating the severe impact of inflationary pressures on daily lives.
