CBN data shows strongest monthly growth of 2025 as October credit surges ₦1.88tn, reversing steep September slump
Credit flowing to the private sector climbed sharply in October 2025, rising to ₦74.41 trillion from ₦72.53 trillion in September, according to the Central Bank of Nigeria’s (CBN) latest money and credit statistics. The ₦1.88 trillion increase represents a 2.60% month-on-month rise, the strongest credit expansion recorded so far this year.
The rebound came on the heels of the Monetary Policy Committee’s (MPC) decision in September to cut the Monetary Policy Rate (MPR) by 50 basis points to 27%, marking its first rate reduction since 2020. Policymakers cited easing inflationary pressures and improving foreign-exchange conditions as justification for the long-awaited policy shift.
At the MPC’s November meeting, the committee kept the benchmark rate unchanged at 27% but adjusted the asymmetric corridor to discourage banks from holding idle liquidity at the CBN, signalling a cautious but steady approach to balancing inflation and credit growth.
Private credit barely higher than last year — but the real story is the October jump
Despite October’s strong performance, year-on-year figures show only a slight increase in private sector credit from ₦74.07 trillion in October 2024 to ₦74.41 trillion in October 2025. The annual rise of ₦0.34 trillion (0.46%) suggests that while private credit has generally hovered around the same level over the past year, the October surge stands out as an immediate response to September’s policy easing.
A volatile year for credit expansion
Credit to the private sector moved in a stop-start pattern throughout 2025 rather than following a smooth upward trend:
- January: ₦77.38tn
- February: ₦76.26tn
- March: ₦75.98tn
- April: ₦78.07tn
- May: ₦77.97tn
- June: ₦76.13tn
- (July unavailable)
- August: ₦75.88tn
- September: ₦72.53tn
- October: ₦74.41tn
The numbers show:
- January to February saw a ₦1.12tn decline (-1.45%)
- March recorded a mild drop of ₦0.28tn (-0.36%)
- April delivered a pronounced rebound, adding ₦2.09tn (+2.75%)
- A renewed decline followed from April to June, wiping out ₦1.84tn in two months
- Credit stabilised in August before plunging ₦3.36tn (-4.42%) in September
- The October recovery clawed back part — though not all — of that loss
Taken together, 2025 has been shaped by tight monetary conditions, fluctuating system liquidity, and rising inflation — all of which constrained lending for much of the year. Even with the October improvement, the private sector has endured a notable squeeze in real terms.
Private sector now drives Nigeria’s domestic credit structure
Total domestic credit, combining lending to government and the private sector climbed from ₦96.69 trillion in September to ₦99.20 trillion in October, up ₦2.51 trillion (2.60%).
Of this:
- Private sector credit contributed about 75% (₦1.88tn)
- Government borrowing accounted for the remaining 25% (₦0.63tn)
In October, the private sector made up 75% of total domestic credit, while government borrowing accounted for 25%, maintaining a similar ratio from September.
However, compared with October 2024, the credit mix has changed significantly:
- Private sector: 65.3% → 75.0%
- Government: 34.7% → 25.0%
The shift is driven by a sharp contraction in government credit. Between October 2024 and October 2025:
- Government credit fell from ₦39.39tn to ₦24.79tn, a ₦14.60tn drop
- Private sector credit increased slightly by ₦0.34tn
- Total domestic credit declined by ₦14.26tn (-12.57%)
This restructuring means the private sector now plays a significantly larger role in domestic credit dynamics and has become the dominant driver of month-to-month changes.
Looking ahead to 2026
With the MPC choosing to cut rates in September and adopt a more conservative stance in November, analysts say the evolution of domestic credit will depend on how effectively banks channel liquidity into private-sector lending rather than government financing.
The interplay between credit demand, government borrowing behaviour, and inflation pressures will shape monetary conditions as Nigeria enters 2026.
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