Credit to the Nigerian government grew by 63 per cent year-on-year to N39.4 trillion in September 2026, while private-sector credit grew by only 16 per cent to N83.9 trillion. The Nigerian Economic Summit Group presented the figures at the Chartered Institute of Bankers of Nigeria’s 2026 Fellowship Investiture in Lagos on 31 October, in a presentation that questioned whether the N4.65 trillion banking recapitalisation is reaching productive businesses.
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A shallow credit market
NESG Chief Executive Tayo Aduloju said private-sector credit stood at 13 per cent of gross domestic product in 2025, against 38.1 per cent in lower-middle-income economies. He named high lending costs, liquidity constraints, credit risks, short financing tenors and competition between government borrowing and private-sector financing as the structural barriers. BusinessDay reported that the same data showed manufacturing credit falling by 34 per cent despite the recapitalisation.
When the state borrows at that pace, small businesses end up competing with it for the same pool of funds, and the state is a safer borrower.
Not a shortage of capital
Aduloju argued that the industrial financing problem is not simply a shortage of capital but the fragmented way existing institutions mobilise and deploy funds. He called for an integrated financing framework involving commercial banks, pension funds, insurers, the Bank of Industry, the Development Bank of Nigeria and credit guarantee institutions.
CIBN President Dele Alabi framed the test in similar terms. The question, he said, is no longer whether banks have enough capital, but whether the funds will translate into new industries, expanded businesses, better infrastructure and sustainable jobs.
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What Lagos and the CIBN propose
Lagos State Governor Babajide Sanwo-Olu urged recapitalised banks to develop more accessible credit products for smaller businesses, support industrial clusters, finance equipment purchases and strengthen supply chains that link small enterprises to larger markets. He said government intervention alone cannot meet the financing needs of Nigeria’s growing business community.
The CIBN will host its MSME Forum on 1 December 2026 to advance solutions on access to finance. It is also advocating MSME hubs across the country that would offer financing, business support, capacity development, digital tools and market opportunities, an idea the institute first raised at its banking conference in September.
Read also: Minister says MSMEs make up 96% of Nigerian businesses, 87% of jobs
What it means for small businesses
For SMEs, the data confirms what lending rates and loan refusals already suggest. Banks hold more capital than at any point in recent years, yet the share of credit reaching private businesses is shallow and growing more slowly than lending to government.
The December forum gives lenders, regulators and business groups a date by which to turn the investiture’s data into commitments. Small business owners will judge it by whether loan terms change, not by how many speeches are made.
