Banks Urged to Boost MSME Lending Amid Yield Decline

Dele Alabi, the President and Chairman of Council of the Chartered Institute of Bankers of Nigeria, urged Nigerian banks to enhance their lending to Micro, Small and Medium Enterprises (MSMEs) during the 2026 Lagos Bankers’ Nite held in Lagos. He emphasized that as interest rates and government securities yields decline, banks must diversify their lending strategies beyond government securities and large corporate borrowers to maintain profitability and support economic growth.

Alabi noted that the recent recapitalisation of the banking sector raised approximately N4.7 trillion, with 72% sourced domestically, indicating the Nigerian economy's capacity to generate capital. He stated that banks could manage the risks associated with MSME lending through appropriate controls and infrastructure.

Godwin Ehigiamusoe, founder of LAPO Microfinance Bank Limited, highlighted the importance of finance and innovation in unlocking opportunities in Lagos, which aims to grow its GDP significantly by 2052.