Home Banking & Finance Nigerians borrow N3.82tn from banks despite economic hardship

Nigerians borrow N3.82tn from banks despite economic hardship

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Credit facilities borrowed by Nigerians from banks increased to N3.82 trillion in January 2024 amid rising inflation and harsh economic conditions.

This information comes from the recent Central Bank of Nigeria (CBN) monthly Economic Report, posted on its official website.

According to the report, total consumer credit rose by 11.9 percent to N3.82 trillion in January 2024, up from N2.648 trillion in December 2023. On a year-on-year basis, this figure represents an increase of N1.41 trillion from N2.41 trillion recorded in January 2023. Additionally, retail loans rose by 3.6 percent to N794.79 billion during the same period.

The report noted that personal loans accounted for 79.2 percent of consumer credit. It stated, “Total consumer credit outstanding increased by 11.9 percent to N3.82 trillion in January 2024, driven mainly by the rise in personal loans on the back of heightened inflation. A disaggregation of consumer credit revealed that personal loans increased by 14.3 percent to N3.028 trillion from N2.648 trillion in December 2023, while retail loans rose by 3.6 percent to N794.79 billion.”

“Personal loans accounted for 79.2 percent of consumer credit, while retail loans accounted for 20.8 percent. Consumer credit, as a share of total credit from ODCs, however, declined to 6.6 percent, from 7.7 percent in the preceding month,” it added.

The increase in credit facilities is closely linked to the rising cost of living due to soaring inflation in Nigeria. The National Bureau of Statistics’ latest inflation report indicated that headline and food inflation increased for the 17th consecutive month to 33.95 percent and 40.66 percent, respectively.

This development comes as Nigeria’s total debt stock rose to N121.67 trillion at the end of March 2024 from N97.34 trillion in December 2023.

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