Nigeria: Nigerians Turning to Survival Loans As Consumption Borrowing Jumps - Report
[This Day] A new survey has found that Nigerians are increasingly turning to formal credit to meet everyday consumption and cope with financial pressures, rather than to expand businesses or build productive capacity.
A new survey conducted by EFInA revealed that Nigerians are increasingly relying on formal credit to meet daily consumption needs and cope with financial pressures. Between 2023 and 2026, the proportion of borrowers taking loans for coping and consumption purposes grew from 31.7% to 40.8%, while borrowing for productive enterprises and household assets declined.
The survey found that formal financial inclusion rose to 73% of adults, with about 87.2 million Nigerians now accessing formal financial services. However, only 25% of adults are considered financially healthy, with 79% being financially included. Among those with formal credit, 45.8% reported repayment stress, and 83.8% experienced ongoing financial or welfare distress.
The leading reasons for borrowing were rent and housing, medical bills, and school fees. Informal employment and farming sectors saw significant increases in borrowing, while rural areas experienced a more than doubling of formal borrowing. The survey highlights that having access to formal financial services does not guarantee financial security or resilience, as only 5.2% of adults have formal insurance coverage.
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