Other Financial Institutions (OFIs), which include Microfinance Banks (MfBs), Development Banks, merchant banks, and mortgage banks, supplied N2.79 trillion, or 10.62 percent of banking industry credit, last year.
According to the Central Bank of Nigeria (CBN), OFIs have made a major contribution to aggregate consumer credit by providing 22.39 million facilities to 9.23 million loan recipients.
This was revealed in the personal statements of the Monetary Policy Committee (MPC) members at their most recent meeting, which was held in November of last year and was recently released.
Adenikinju Festus, a member of the MPC, stated at the meeting’s conclusion that, as of October last year, banking industry credit was on the rise.
He stated that the CBN intervention funds have played a significant role in the rise in banking industry credit. “All measures of industry size, bank credit, assets, and deposits were higher than in October 2020.” The increase in bank industry credit, which increased from N19.39 trillion in October 2020 to N23.49 trillion in October 2021, is of particular significance.
“The Development Financing Report provided an aggregate and sectoral breakdown of central bank interventions in the economy.” The intervention’s sectoral and geopolitical breakdown revealed that the intervention funds benefited core sectors of the economy and Nigerians from various geopolitical zones.”
“Nigerians who would not otherwise have been able to access credit from the formal market have benefited from the intervention funds.” The CBN’s measures have strengthened the economy’s demand and real sides. Increasing demand is crucial given the importance of consumption in aggregate GDP and the significant compression in real income produced by COVID-19. The increase in aggregate supply has the potential to boost GDP while simultaneously lowering the general price level.”
Meanwhile, he added that, despite improvements in the country’s non-oil revenue, its ratio to GDP “is still too low, and there is room for both non-oil and oil revenues to expand to boost the capacity of governments at all levels to deliver on their promises to the Nigerian people.”