Finance

Fintechs boost consumer loans to N2.35tn

The increasing usage of loan apps and other fintech channels pushed total consumer credit to N2.35tn in the first quarter of 2023.
This showed a 20.95 per cent rise from the N1.94tn in the fourth quarter of 2021, according to data from the Central Bank of Nigeria’s Quarterly Economic Reports.
In Q1, 2023, increase in banking liquidity and enhanced access to formal financial services through fintech channels boosted consumer credit, the apex bank noted.
The CBN report stated, “The increase in banking system liquidity and enhanced access to formal financial services, especially through fintech channels, that accompanied the naira redesign policy, boosted consumer credit.
“Thus, consumer credit increased by 1.3 per cent, to N2.35tn from N2.32tn at the end of the preceding quarter and accounted for 8.1 per cent of total claims in the private sector. A disaggregation of consumer credit showed that personal loans stood at N1.75tn, or 74.5 per cent, while retail loans, at N598.28bn, accounted for the balance of 25.5 per cent.”
In the fourth quarter of 2021, consumer credit was driven by a slight decline in maximum lending rates. The apex bank stated, “Consumer credit outstanding increased due to higher personal and retail loans. Consumer credit outstanding, at N2.07tn, rose by 6.7 per cent at the end of December 2021 from N1.94tn at end of September 2021. At that level, consumer credit constituted 8.5 per cent of total credit to the private sector.”
According to the bank, banking system liquidity grew on the net effects of fiscal and monetary operations in the quarter, with total fiscal injection and repayment of matured CBN bills rising to N2.45tn and N309.44bn from N2.31tn and N231.19bnin the preceding quarter, respectively.

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