The Central Bank of Nigeria (CBN) has reported that Nigerians took out a staggering N470 billion in personal loans from banks in just three months (October–December 2024), underscoring the deepening financial strain on households due to skyrocketing inflation and stagnant wages.

According to the CBN’s Fourth Quarter 2024 Economic Report, total consumer credit surged by 11.06% to N4.72 trillion, with personal loans alone jumping by 21.27% to N3.82 trillion — making up 80.98% of all consumer credit.

Meanwhile, retail loans (typically used for business or property) dropped sharply by 18.18% to N900 billion, signaling that Nigerians are borrowing more for survival rather than investment.

Analysis: A Desperate Response to Tinubu’s Harsh Economic Policies

This surge in personal borrowing reflects the devastating impact of President Bola Tinubu’s economic policies, which have plunged millions into financial distress. Key factors driving this trend include:

1. Fuel Subsidy Removal & Hyper-Inflation – Since Tinubu scrapped petrol subsidies in May 2023, transport and food costs have spiraled, with inflation hitting 33.2% in March 2024. Many Nigerians now rely on loans to afford basic necessities.

2. Naira Devaluation and Shrinking Purchasing Power – The freefall of the naira (now N1,550/$ on the parallel market) has made imports unbearably expensive, forcing families to borrow just to keep up with prices.

3. Collapse of Small Businesses – The decline in retail loans suggests that even entrepreneurs are struggling to access credit, as banks deem them too risky in this volatile economy.

A Growing Debt Trap?

While the CBN frames this as "increased access to credit," the reality is that Nigerians are borrowing to survive, not to thrive. With lending rates up to 40% in some cases, many risk falling into long-term debt cycles, especially as repayment becomes harder amid job losses and inflation.

Conclusion: A Symptom of a Failing System

The N470 billion loan spike is not a sign of financial empowerment but a red flag for Nigeria’s worsening cost-of-living crisis.

The borrowing frenzy is less about economic growth and more about desperation — a clear indictment of policies that prioritize market reforms over citizen welfare.