Consumer credit in Nigeria recorded a significant decline, dropping by 17 per cent month-on-month to N3.54 trillion in July 2025, down from N4.27 trillion recorded in June 2025.

This sharp fall was primarily triggered by a decline in retail demand.

The breakdown, detailed in the Central Bank of Nigeria’s July 2025 Economic Report, showed that the total consumer credit figure comprised N950 billion in retail loans and N2.59 trillion in personal loans.

Further analysis revealed that retail loans experienced a sharp decrease, falling by 51.5 percent MoM to N950 billion from N1.96 trillion in June. This steep reduction reflects consumers’ low appetite for credit, largely attributed to high interest rates.

The CBN’s July Consumer Expectations Survey Report supported this observation, noting that “a higher percentage of respondents (40.6 percent) observed a rise in the interest rates on bank loans over the past three months.”

Despite this current perception, the CBN further stated: “Fewer respondents (34.4 percent), however, anticipated a rise in interest rate in the next three months.” While retail loans plummeted, personal loans saw growth, increasing by 12.12 percent MoM to N2.59 trillion in July from N2.31 trillion in June 2025.

This performance followed a period of growth in the preceding quarter, as consumer credit had increased by 6.48 percent to N4.27 trillion in the second quarter of 2025 from N4.01 trillion in the first quarter of 2025.

The CBN’s latest Monthly Economic Report provided a clear summary of the trend, stating: “Consumer credit outstanding fell by 17.10 per cent to N3.54 trillion at end-July 2025, from N4.27 trillion in the preceding month.”

The report clarified the drivers of the decline: “The decrease in consumer credit was driven by the 51.53 per cent decline in retail loan, which offset the 12.21 per cent increase in personal loan.”

Disaggregated data highlighted the composition of the outstanding credit: “Disaggregated data showed that personal loans stood at N2.59 trillion, accounting for 73.16 per cent of the total, while retail loans, at N0.95 trillion, accounted for the balance.”

The CBN concluded that “The dominance of personal loans over retail loans over time reflected steady household demand for liquidity.”