More Nigerians are gaining access to financial services, but only a small fraction can obtain credit from formal financial institutions, highlighting a major gap in the country’s financial system, according to a new report.
The Nigeria Credit Landscape Report 2025, published by Credit Direct in June 2026, found that while more than 64 percent of Nigerian adults are now financially included, only about six percent currently access credit through formal channels.
The report described the trend as a paradox in Africa’s largest economy, where increased participation in the financial sector has not translated into broader access to loans for households and businesses.
According to the findings, credit to Nigeria’s private sector stands at just 13.1 percent of gross domestic product (GDP), significantly below levels recorded in comparable African economies such as Kenya and South Africa.
The report said the low level of formal credit penetration continues to limit opportunities for entrepreneurs, households and small businesses seeking capital to expand operations, invest or manage financial pressures.
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Despite the credit constraints, Nigeria’s real sector showed signs of resilience throughout 2025. Manufacturing, services and agriculture all recorded sustained growth, driving increased demand for working capital and business financing.
Analysts say the mismatch between economic activity and access to credit could slow business expansion and job creation if not addressed.
The report identified several barriers that continue to restrict access to lending, including limited credit histories, high borrowing costs and structural challenges within the financial system.
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It noted that expanding access to affordable credit would be critical to supporting businesses and sustaining economic growth, particularly among small and medium-sized enterprises, which form the backbone of the country’s economy.
Reacting to the findings, Mutual Benefits Assurance Plc said the report underscored the need for a broader approach to financial inclusion that goes beyond access to banking services and loans.
The insurance company argued that financial inclusion should also encompass savings, insurance coverage and long-term financial planning to improve economic resilience.
“The findings reinforce the urgent need for a more holistic approach to financial inclusion,” the company said.
While credit remains an important driver of economic growth, the insurer said financial protection mechanisms are equally essential in helping individuals and businesses withstand economic shocks and unexpected disruptions.
Industry stakeholders have increasingly called for reforms aimed at strengthening credit infrastructure, improving financial literacy and encouraging responsible lending practices.
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Financial experts say widening access to formal credit could help unlock investment, boost productivity and support inclusive economic growth, especially as Nigeria seeks to diversify its economy and create employment opportunities for its rapidly growing population.
The report’s findings come amid ongoing efforts by policymakers and financial institutions to deepen financial inclusion and expand the reach of formal financial services across the country.
However, the latest data suggests that while more Nigerians are entering the financial system, significant work remains to ensure they can access the financing needed to improve livelihoods and grow businesses.
