A recent survey by Enhancing Financial Innovation and Access (EFInA) has found that Nigerians are borrowing from formal lenders for consumption and coping needs rather than investing in businesses. The 2026 Access to Financial Services in Nigeria (A2F) Survey showed that 40.8% of formal borrowers used loans mainly for consumption and coping needs, up from 31.7% in 2023. This shift in borrowing purposes indicates a change in the way Nigerians are using formal credit.
The survey, which covered 18,679 adults across the 36 states and the Federal Capital Territory, found that the share of borrowers using formal loans for productive enterprises fell to 34.3% from 40.2%. Borrowing for household assets also declined to 23.4% from 25.2% over the same period. Despite this shift, formal credit uptake increased to 10% of adults in 2026 from 6% in 2023, putting about 11.9 million Nigerians on the books of regulated lenders.
The survey, conducted with oversight from the National Bureau of Statistics (NBS), found that credit uptake among the informally employed tripled to 15% from 5%, while borrowing among young adults aged 18 to 35 rose to 10% from 4%. Among farmers, credit uptake doubled to 6%. This increase in credit uptake indicates that more Nigerians are accessing formal credit, but the purposes of borrowing are changing.
However, increased access to credit has not eased financial pressure for many borrowers. The survey found that 45.8% of formal borrowers reported repayment difficulties and 83.8% said they remained under financial strain. This suggests that while more Nigerians are accessing credit, many are struggling to repay their loans and remain financially strained.
The survey also found that overall financial inclusion rose to 79%, representing about 94.2 million adults, while formal financial inclusion stood at 73%. EFInA said only about one in four adults was financially healthy. This indicates that while more Nigerians have access to financial services, many are not financially healthy and are struggling to manage their finances.
EFInA Chief Executive Officer, Foyinsolami Akinjayeju, said access to financial services could no longer be the sole measure of progress. She stressed the need to assess whether financial services were improving the financial well-being of households. The findings showed the need for a stronger focus on the outcomes of financial inclusion rather than access alone.
The report's findings have implications for policymakers and financial institutions. To improve the financial well-being of households, there is a need to focus on providing financial services that meet the needs of Nigerians, rather than just increasing access to credit. This may involve developing financial products and services that help borrowers manage their debt and improve their financial stability.
Key points
- Formal borrowing in Nigeria is shifting from business investment to consumption and coping needs.
- Credit uptake has increased, but many borrowers are struggling with repayment difficulties and financial strain.
- There is a need for a stronger focus on the outcomes of financial inclusion rather than access alone.
