Manufacturers Grapple with 60% Lending Rates Despite CBN Easing Measures
Manufacturers in Nigeria continue to face borrowing costs as high as 60 per cent despite recent monetary policy easing by the Central Bank of Nigeria, new data from the apex bank shows.
The figures, detailing lending and deposit rates across deposit money banks as of March 20, 2026, indicate that while some banks offered lower prime lending rates, maximum borrowing costs remain significantly elevated.
The Monetary Policy Committee of the CBN in February 2026 reduced the benchmark interest rate to 26.5 per cent. CBN Governor Olayemi Cardoso announced the decision after the committee’s 304th meeting in Abuja.
“The Committee decided to reduce the monetary policy rate by 50 basis points to 26.5 per cent,” Cardoso said. He added that the MPC resolved to “retain the Standing Facilities Corridor around the MPR at +50/-450 basis points” and to “retain the Cash Reserve Requirement for Deposit Money Banks at 45 per cent, Merchant Banks at 16 per cent, and 75 per cent for non-TSA public sector deposits.”
This is the second rate cut under the current CBN leadership, following a similar 50-basis-point reduction in September 2025 and a hold in November 2025.
Cardoso said the decision reflected “a balanced evaluation of risks to the outlook,” noting that “the ongoing disinflation trajectory would continue, largely supported by the lagged transmission of previous monetary tightening, sustained exchange rate stability, and enhanced food supply.”
Despite the cut, manufacturing prime lending rates ranged from as low as one per cent at Stanbic IBTC to above 30 per cent at several banks, including FCMB, Globus Bank, Keystone Bank, Polaris Bank, Unity Bank, and Wema Bank.
Maximum lending rates remain high. Stanbic IBTC recorded the highest at 60 per cent, followed by FCMB at 46 per cent. Union Bank and Unity Bank posted 37 per cent and 38 per cent, respectively, while Fidelity Bank, First Bank, Polaris Bank, and Sterling Bank quoted 33–36 per cent.
Even banks with moderate prime rates maintained high ceilings. Access Bank recorded a 25.5 per cent prime and 32 per cent maximum, Ecobank 26.75 per cent and 33 per cent, and Guaranty Trust Bank 10 per cent and 32 per cent, respectively.
Merchant banks showed similar trends. Coronation Merchant Bank had a nine per cent prime and 35 per cent maximum, while FSDH Merchant Bank reported 7 per cent and 30 per cent.
On the deposit side, returns remain subdued. Savings rates clustered around 7.95 per cent across most banks, with Standard Chartered Bank, United Bank for Africa, and SunTrust Bank slightly higher at 8.1 per cent. Stanbic IBTC offered only 2.65 per cent.
Demand deposit rates were mostly below 1 per cent. Globus Bank recorded 0.01 per cent, Access Bank 0.52 per cent, and Wema Bank 0.74 per cent. Time deposit rates varied from 7.8 per cent at Citibank to 19.59 per cent at Keystone Bank. Greenwich Merchant Bank offered 14 per cent for demand deposits and 17.5 per cent for time deposits.
The wide gap between lending and deposit rates highlights the high cost of financial intermediation, with manufacturers bearing the brunt. CBN data shows lending to manufacturing fell from N8.53tn in December 2024 to N7.09tn by September 2025, a reduction of N1.44tn or 16.9 per cent, reflecting manufacturers’ pullback amid high rates, weak demand, and rising operating costs.
Manufacturers have repeatedly complained that double-digit borrowing rates undermine long-term investment. Analysts note that high MPC rates continue to increase financing burdens, potentially affecting employment and economic growth.
The Director-General of the Nigerian Association of Small and Medium Enterprises, Eke Ubiji, said borrowing conditions remain harsh for MSMEs despite improvements in macroeconomic indicators. “The CBN needs to still go around their decision on the MPR and see what could be done. It is still not encouraging borrowing from the private sector,” Ubiji said.