Nigeria’s Consumer Credit Push via CREDICORP

Over the years, Nigeria has struggled with low access to credit for everyday people. Most consumers have never had a credit card, and banks typically lend to government or large corporations instead of regular citizens. But that is starting to change with the government’s renewed focus on consumer credit through the Credit Corporation of Nigeria, also known as CREDICORP.

The new initiative aims to expand lending to working Nigerians, especially salary earners and small business owners. If successful, it could reshape how people spend, save, and invest, and it may even influence the performance of retail and financial stocks on the Nigerian Exchange (NGX).

CREDICORP was established by the federal government to create a structured consumer credit system, improve financial inclusion, and boost access to affordable loans. The plan is simple: make it easier for people with steady income to borrow for things like housing, education, cars, and business needs.

The corporation will act as a central body that coordinates lenders, sets standards for credit scoring, and ensures transparency in loan approval and repayment systems. It will also partner with credit bureaus to expand Nigeria’s credit data infrastructure, a crucial step since most Nigerians currently have no formal credit history.

Nigeria’s economy has long been driven by cash transactions. With inflation still high and real wages under pressure, the ability to access credit can help consumers smooth spending, invest in productive assets, and stimulate demand.

When people can borrow responsibly, it increases consumption and helps businesses grow. Retailers can sell more products, manufacturers can expand production, and service providers can experience higher turnover.

At a macro level, the expansion of consumer credit supports economic growth by increasing aggregate demand. It also strengthens the banking sector through diversified lending portfolios. Instead of concentrating risk in corporate or government lending, banks can spread exposure across millions of small borrowers.

Nigeria’s credit-to-GDP ratio remains very low compared to global averages, hovering below 20%. Countries like South Africa and Kenya are far ahead. Expanding credit access through CREDICORP is an attempt to bridge that gap and empower Nigerians to participate more fully in the formal economy.

If implemented effectively, the initiative could mark the beginning of a long-term transformation in how Nigerians interact with financial institutions. It could promote a credit culture, support job creation, and make the financial markets deeper and more resilient.