To be fair to Nigerian banks, loan credibility has always been a major challenge. Many Nigerians take loans from banks and fail to pay back, and in any economy, once credibility is weak, bank lending rates automatically rise.
As of today, the Nigerian Monetary Policy Rate (MPR) is 27.50%. This means digital and commercial bank lending rates should be around 15%–40%. However, some banks offer lower rates, depending on the borrower’s risk profile, collateral, type of loan, business relationship with the bank, and internal policies.
There are also some government intervention loans with interest rates as low as 5%.
The bottom line is this: Smart business owners don’t just borrow; they count the cost. So, don’t take a loan with an outrageous interest rate unless you’re certain you can manage it.
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