Nigerian Manufacturers Face 60% Borrowing Costs Amid Rate Cuts

Manufacturers in Nigeria are currently facing borrowing costs as high as 60%, according to a report detailing lending and deposit rates from the Central Bank of Nigeria (CBN). Despite a recent reduction in the benchmark interest rate to 26.5% announced by CBN Governor Olayemi Cardoso during the Monetary Policy Committee's 304th meeting in February 2026, the maximum lending rates offered by banks remain significantly elevated.

For instance, Stanbic IBTC has the highest maximum lending rate at 60%, followed by FCMB at 46%. The report indicates that lending to the manufacturing sector decreased from N8.53 trillion in December 2024 to N7.09 trillion in September 2025, reflecting a 16.9% reduction due to high borrowing costs and weak demand.

Ek Ubiji, Director General of the Nigerian Association of Small and Medium Enterprises, noted that borrowing conditions remain harsh for MSMEs, despite improvements in macroeconomic indicators. Additionally, foreign investment in Nigeria's manufacturing sector fell to $654.43 million year-on-year, highlighting the challenges faced by the sector.