Tinubu demands affordable credit for businesses after bank recapitalisation

President Bola Tinubu has urged Nigerian banks to convert the recent recapitalisation into affordable credit for businesses, warning that the financial sector's success depends on the availability of credit for productive sectors. Speaking at the 19th Annual Banking and Finance Conference, Tinubu emphasized that a resilient banking system cannot exist without businesses obtaining affordable credit and that the recapitalisation must result in capital formation in the real economy.

The Nigerian government is increasing guarantees, risk-sharing, blended finance, and credit enhancement mechanisms to reduce risks associated with lending to productive sectors. Tinubu also called for a gradual shift away from government securities towards private-sector lending as fiscal conditions improve. Bank CEOs agree that the recapitalisation has strengthened their ability to finance the economy, with banks raising N6.4 trillion during the exercise.

However, World Bank Country Director Mathew Verghis noted that credit remains concentrated away from sectors responsible for significant employment, with MSMEs receiving only one per cent of credit.