25:I[95528,["8320","static/chunks/41ade5dc-90c252cb9fc58faa.js","4514","static/chunks/4514-c6f7fd4243ca1382.js","8500","static/chunks/8500-e4dd1cb1bb626827.js","5772","static/chunks/5772-d567479163a90457.js","5435","static/chunks/5435-aeb0c97bbd6a1e26.js","581","static/chunks/581-ddacfe5584430cec.js","2576","static/chunks/2576-2302c7e93f25ab96.js","5103","static/chunks/app/blog/post-blog/%5Bslug%5D/page-90992d1d58394cd0.js"],"default"] 26:Td0f,

Banks Lent N14 Trillion Less to Businesses in Two Months. Here's What That Means.

First, let me explain something called "private sector credit"?

It's simply money that banks lend to businesses, from the smallest shop to the largest manufacturer. When this number goes up, businesses are borrowing to expand, buy equipment, or manage cash flow. When it goes down, businesses are borrowing less and possibly struggling.

In the modern economy, debt is not always a bad thing, either for businesses or for nations.

In February 2026, private sector credit hit N94.61 trillion, a 12-month high. By April 2026, it had crashed to N80.59 trillion. That's a drop of over N14 trillion in just two months.

Why did this happen?

In February, the Central Bank cut interest rates from 27% to 26.5%. Normally, lower rates encourage borrowing. But the opposite happened. Borrowing collapsed.

Why? Three reasons.

First, 26.5% is still extremely high. A small cut doesn't change the reality that borrowing is expensive.

Second, banks prefer lending to the government (buying Treasury bills at high interest) instead of lending to businesses. Government debt is safer.

Third, businesses themselves are nervous. With inflation at 15.69% and the naira unstable, many are delaying expansion plans.

WHAT THIS MEANS FOR YOU AS A BUSINESS

If you own a business and need a loan, expect banks to be cautious. Even though the money supply is high (N124.99 trillion in circulation), that money isn't flowing to you. It's flowing to government securities.

Your best strategy is to make yourself bankable.

This means

- Clean financial records.

- Tax readiness.

- A clear plan for how you'll use the money and repay it.

Zidwell can help with this.

Banks are still lending, just selectively.

N14 trillion disappearing from private sector credit in two months is alarming. That's money that could have bought equipment, hired workers, or expanded operations. Instead, it went elsewhere or vanished entirely.

The CBN cut rates to help. But the cut was too small, too late, and overwhelmed by bigger problems.

The lesson here:

Monetary policy alone can't fix a broken credit system. Banks must be encouraged, or forced to lend productively. Until then, businesses will suffer because its much safer for banks and high-net-worth individuals to put their money in government bonds, stocks, or real estate.

Are you finding it harder or easier to get a business loan compared to last year?

--------------------------

Sign up on zidwell.com to get a business bank account in under 30 seconds. No long forms, No 2 guarantors, No delays. Give your business the legitimacy with an account that carries your brand name. DISCLAIMER: We’re not a financial institution; this bank account service is provided in partnership with Nomba MFB for ease of doing business.

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