In the first half of 2026, Nigerian banks reduced the amount of credit extended to the manufacturing sector by 26.8 percent year‑on‑year, falling to N5.19 trillion from N7.09 trillion in the same period of 2025, according to the Central Bank of Nigeria’s (CBN) Q2 2026 Statistical Bulletin.
The decline reflects a broader slide in outstanding bank credit to manufacturers, which dropped about 21 percent between January and June 2026, moving from N6.57 trillion to N5.19 trillion. Monthly figures show credit slipping from N6.57 trillion in January to N6.37 trillion in February, N5.77 trillion in March, N5.32 trillion in April, N5.02 trillion in May, before a modest rebound to N5.19 trillion in June. While the June level remained well below the previous year’s figure, the data do not specify whether the contraction stems from reduced new lending, loan repayments or other portfolio adjustments.
Manufacturers say the tightening credit comes amid persistent financing constraints, high production costs, expensive electricity, logistics bottlenecks and exchange‑rate pressures. The Manufacturers Association of Nigeria (MAN) has called for stronger credit guarantees and the full operationalisation of a N1 trillion Manufacturing Stabilisation Fund, which it wants domiciled with the Bank of Industry (BoI) to address the funding gap.
In parallel, the National Credit Guarantee Company (NCGC) announced that it had unlocked N46.95 billion in loans for 67,512 borrowers across the country, using N21.59 billion in guarantees to share lending risk with financial institutions. “The credit was unlocked using guarantees to share lending risks with financial institutions,” said Dr Bonaventure Okhaimo, Managing Director/Chief Executive Officer of NCGC.
The Bank of Industry estimates that Nigeria needs more than $35 billion annually to finance industrialisation and raise manufacturing’s contribution to GDP to 25 percent. Dr Olasupo Olusi, Managing Director of BoI, warned that “no single development finance institution could close the gap,” noting a 63 percent shortfall in its 2025 pipeline where loan applications totalled N1.754 trillion against available funding of N645 billion. MAN Director‑General Segun Ajayi‑Kadir praised the NCGC model as a risk‑sharing mechanism but said the N46.95 billion unlocked is “a drop in that $35 billion ocean,” urging a massive scale‑up of guarantees and a dedicated financing facility to lift the credit squeeze facing Nigerian manufacturers.
<small>Source: Vanguard News — read the original story there.</small>
