Retail loans decline despite rise in consumer credit to N3.81 trillion in January

Retail loans decline despite rise in consumer credit to ₦3.81 trillion in January

Nigeria’s consumer credit outstanding rose to about ₦3.81 trillion in January 2026, up 0.79% from ₦3.78 trillion in December, according to the Central Bank of Nigeria’s January 2026 Economic Report. The increase was driven entirely by personal loans, which grew by roughly 5.95% to ₦1.96 trillion and accounted for just over half of total consumer credit. In contrast, retail loans fell by about 4.15% to ₦1.85 trillion, leaving their share at 48.56% and underscoring a divergence between headline consumer‑credit growth and traditional retail lending.

The pattern highlights how banks are reshaping household lending in a tight monetary environment. With the policy rate at elevated levels and liquidity conditions still constrained, deposit money banks appear more willing to extend payroll‑linked or otherwise structured personal loans than broad retail credit, which typically includes more general‑purpose and card‑type products with higher perceived risk. That fits into a wider picture of cautious credit expansion: CBN data for January show that overall credit to the private sector slid to ₦75.24 trillion, down from ₦75.83 trillion in December 2025, even as the federal government pushes for more consumer credit through mechanisms like CREDICORP.

For households and small businesses, the numbers mean that access is becoming more segmented. Formal workers with stable payrolls are better placed to benefit from the rising stock of personal loans, while informal workers and micro‑enterprises face tighter screens or more expensive borrowing as banks de‑emphasise broad retail lending. The risk is that, without faster income growth and broader formalisation, the apparent expansion in consumer credit could coexist with persistent credit constraints for the very households and small firms that are under the most pressure from inflation and weaker real incomes.

NUMBER TO WATCH ₦3.81 trillion – total consumer credit outstanding in January 2026, with personal loans at ₦1.96 trillion and retail loans at ₦1.85 trillion.

RISK TO WATCH If tight monetary conditions persist and banks continue to favour payroll‑linked personal loans over broader retail credit, the expansion of consumer credit could bypass much of the informal economy, reinforcing existing inequalities in access to finance.