A recent report reveals that loans from commercial banks to the private sector in Nigeria surged by approximately N2.3 trillion between June and July 2024.
Data from the Central Bank of Nigeria (CBN) shows that credit to the private sector (CPS) increased by 34% over the past year, rising from N56.46 trillion in July 2023 to N75.5 trillion in July 2024. According to experts, CPS encompasses loans, trade credits, and other financial facilities provided by banks to the private sector, and its significant growth reflects the resilience of the Nigerian economy.
The report highlights that CPS rose by 33.7% to N75.48 trillion in July 2024, compared to N56.46 trillion in July 2023, marking an increase of N19.02 trillion. Between June and July 2024, CPS grew by 3.1%, or N2.29 trillion, from N73.19 trillion to N75.48 trillion.
Growth in Bank Deposits
Additionally, a CBN report indicated that Nigerian banks experienced a significant deposit rise during the first half of 2024. Demand deposits increased from N26.7 trillion at the end of December 2023 to N33.0 trillion by June 2024. The total demand deposits in the first quarter of 2024 rose by 8.1% to N28.9 trillion, while in the second quarter, they grew by 14.3% to N33 trillion.
Banks’ audited reports for 2023 also show substantial growth in deposits:
- Access Holdings: Deposits increased from N6.10 trillion in 2022 to N9.4 trillion in 2023.
- Zenith Bank: Grew deposits from N5.86 trillion to N11.43 trillion.
- FBN Holdings: Recorded deposits of N7.85 trillion in 2023, up from N5.25 trillion in 2022.
- United Bank for Africa (UBA): Deposits doubled from N4.83 trillion in 2022 to N9.32 trillion in 2023.
- Guaranty Trust Holding Company: Increased deposits from N3.47 trillion to N5.22 trillion.
Expert Opinions
Experts have noted that while the growth in credit to the private sector demonstrates the economy’s resilience, such credits are still needed to benefit all sectors of the economy.
Tunde Balogun, CEO of SmallSmall, highlighted the significant credit gap in the Nigerian economy and called for a more comprehensive approach to bridging it. Economist Dr. Muda Yusuf also prioritised small businesses in credit offerings to stimulate economic growth.
