BANK LENDING TO NIGERIAN MANUFACTURERS FALLS 26.8% to ₦5.19 TRILLION

Bank credit to Nigeria’s manufacturing sector fell by 26.8 per cent year-on-year to ₦5.19 trillion in June 2026, raising concerns about access to financing for businesses seeking to expand local production. The figures were attributed to the Central Bank of Nigeria’s second-quarter statistical bulletin, Outstanding bank credit to manufacturers stood at approximately ₦7.09 trillion in June 2025 before declining to ₦5.19 trillion in June 2026. The figures highlight the financing challenges facing manufacturers amid high operating expenses and continued pressure on businesses, manufacturing companies require long-term financing to purchase machinery, maintain facilities, acquire raw materials and expand production. When credit becomes expensive or difficult to obtain, businesses may postpone investment or reduce their plans for expansion, manufacturers must also contend with electricity costs, transportation expenses, exchange-rate pressures and the cost of importing certain production inputs. These challenges can make locally produced goods more expensive and limit the ability of domestic companies to compete with imported products. The Manufacturers Association of Nigeria has reportedly called for stronger credit guarantees and the full operationalisation of a proposed ₦1 trillion Manufacturing Stabilisation Fund, credit guarantees can encourage financial institutions to lend by sharing some of the risks associated with lending to eligible businesses. Separately, the National Credit Guarantee Company reported that its guarantee arrangements had helped unlock approximately ₦46.95 billion in loans for 67,512 borrowers. However, expanding access to finance will require more than the announcement of funding programmes. Businesses must be able to access loans on terms that match their investment needs and repayment capacity, manufacturing supports employment, local supply chains and the production of goods needed by Nigerian households and businesses. A sustained reduction in access to credit could constrain investment, although the decline in outstanding loans alone does not establish whether the change resulted from reduced new lending, repayments or other changes in banks’ portfolios. Policymakers and financial institutions will therefore need to examine both the availability and affordability of financing. Improving access to suitable credit could help manufacturers invest in production, create employment and strengthen Nigeria’s industrial base.