Relief as Banking Sector Lending Rate to Businesses Drop to 29.19%
Kayode Tokede Amidst outcry by businesses in Nigeria over the high cost of borrowing, the banking sector average maximum lending rate closed August 2026 at 29.20 per cent, about 3.96
Nigerian businesses have breathed a sigh of relief as the average maximum lending rate among banks has dropped to 29.19 per cent in August 2026. This is a significant decrease of 3.96 per cent from the previous month's rate of 33.16 per cent. The Central Bank of Nigeria (CBN) attributed this drop to a reduction in the Monetary Policy Rate (MPR) to 26.50 per cent from 27 per cent.
The maximum lending rate is the highest permissible interest rate that banks can charge borrowers and is instrumental in ensuring fair lending practices and protecting borrowers from excessive interest rates. Throughout 2026, banks such as Stanbic IBTC, Ecobank, and FCMB Bank had the highest "General" maximum lending rates, with Stanbic IBTC at 60 per cent, Ecobank at 48 per cent, and FCMB Bank at 45 per cent.
The International Monetary Fund (IMF) had previously noted that the transmission of monetary policy changes within the Nigerian banking sector is asymmetrical, with borrowing rates adjusting rapidly upward during tightening cycles but only gradually declining during easing cycles.
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