Nigeria’s lenders loosened their purse strings in Q3 2025. The CBN’s Credit Conditions Survey points to improved economic activity as a key driver behind this increased credit supply. Banks seemed more willing to lend across secured, unsecured, and corporate segments.

It’s interesting how lenders attribute the shift. For secured and corporate loans, a brighter economic outlook appeared to instill confidence. Yet, unsecured lending seemed more influenced by banks’ internal risk assessments. This suggests a nuanced approach, where macroeconomic optimism doesn’t automatically translate into easier access for everyone.

Demand for credit also saw a general upswing. Companies, big and small, wanted to borrow more. Still, the details are revealing. Households showed less enthusiasm for mortgages, while personal and consumer loans gained traction. This possibly reflects a shift towards immediate liquidity needs rather than long-term investments in property.

What about the cost? Spreads on lending rates relative to the benchmark MPR actually widened for secured and unsecured loans. That means even with increased supply, borrowers paid more. Default rates present another side of the story. Unsecured and corporate lending saw higher defaults. Even with expanding credit, risk remains a significant factor, especially for small businesses. I’ve seen this pattern before – a rush to lend can sometimes overlook underlying vulnerabilities.

Inventory finance emerged as a major reason why companies sought credit. They need funds to stock up, restructure, invest in capital projects, and dabble in commercial real estate. These needs imply they’re gearing up for expansion.

The survey paints a picture of cautious optimism. Lenders are supplying more credit, but they’re also factoring in risks. Businesses are borrowing, mainly to fuel their operations and expansion. A key question remains: Can this increased credit supply translate into sustainable growth, or will those elevated default rates become a drag? It will be interesting to see.

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Keywords: Nigeria lending, credit conditions, bank loans, secured loans, unsecured loans, corporate lending, inventory finance, loan default rates