In Nine Months, Rising Cost of Living Pushes Nigerians to Borrow N740bn from Banks

The rising cost of living has pushed Nigerians to borrow about N740 billion from banks between January and September this year.

An analysis of the quarterly economic reports of the Central Bank of Nigeria (CBN) shows that consumer credit rose from N2.31 trillion by the end of the fourth quarter of 2022 to N3.05 trillion by the end of the third quarter of 2023.

This shows an increase of 32% or N740 billion in nine months as Nigerians struggle with unwavering inflation and waning purchasing power.

Steady Quarterly Increase
Consumer credit has been on the rise throughout the year, increasing by 1.7% to N2.35 trillion by Q1 2023, from N2.31 recorded in Q4 2022.
It further rose to N2.6 trillion by Q2 2023, showing a quarterly increase of 10.6%.
By Q3 2023, there was a quarterly increase of 17%, reaching an all-time high of N3.05 trillion.

“Consumer credit outstanding increased, attributable to the need to cope with a relative increase in the cost of living. Thus, consumer credit grew by 15.5% to N3.05 trillion, compared with the N2.64 trillion at the end of the preceding quarter.
“Analysis of consumer credit by components revealed that personal loans increased by 18.6% to N2.28 trillion, as against the N1.92 trillion in the preceding quarter, while retail loans, at N766.97 billion, grew by 7.3%.
“In terms of composition, personal loans continued to account for the larger share (74.8%), while retail loans accounted for the balance (25.2%).
“As a share of total sectoral credit from the Other Depository Corporations (ODCs), consumer credit rose to 7.8%, from 7.0% in the preceding quarter.”