Credit extended by Nigerian banks to the manufacturing sector fell by 26.8 per cent year-on-year to N5.19 trillion in June 2026, from N7.09 trillion in the corresponding period of 2025, according to data from the Central Bank of Nigeria (CBN).
The CBN’s second-quarter 2026 statistical bulletin also showed a sustained decline in outstanding bank credit to manufacturers during much of the first half of the year, amid persistent challenges, including high production costs, electricity expenses, logistics constraints and exchange-rate pressures.
The data indicated that manufacturing credit declined from N6.57 trillion in January to N6.37 trillion in February, before falling further to N5.77 trillion in March and N5.32 trillion in April.
Lending dropped to N5.02 trillion in May before recovering slightly to N5.19 trillion in June. Overall, the June figure represented a decline of about 21 per cent from January.
Despite the contraction in bank credit, manufacturing continued to contribute to Nigeria’s economic output and government revenue.
The sector accounted for 9.57 per cent of the country’s real Gross Domestic Product in the first quarter of 2026.
Data from the National Bureau of Statistics also showed that manufacturing generated N297.68 billion in Value Added Tax revenue in the second quarter of 2025, compared with N286.95 billion in the preceding quarter.
The sector contributed N1.17 trillion in VAT revenue in 2025, up from N803.53 billion in 2024.
However, manufacturers continue to face rising input costs, expensive electricity, logistics bottlenecks, insecurity, exchange-rate instability and multiple taxation, which can constrain production and business expansion.
The decline in outstanding bank credit underscores concerns about financing conditions for manufacturers seeking to maintain operations, acquire equipment and expand production capacity.
However, the CBN figures do not establish whether the reduction resulted from lower new lending, loan repayments or other changes in outstanding credit balances.
Boluwatife Enome
Follow us on:
