65.5% of Nigerians want lending rates to drop – CBN

 ​A recent survey conducted by the Central Bank of Nigeria (CBN) reveals that a significant majority of Nigerians are advocating for a reduction in lending rates. Specifically, 71.4% of respondents expressed a preference for lower interest rates, reflecting widespread concerns about the high cost of borrowing and its impact on both businesses and households. ​

The survey, part of the CBN’s ongoing efforts to gauge public sentiment on monetary policy, indicates that only 12.5% of respondents support an increase in interest rates, while 16.1% prefer that rates remain unchanged. This overwhelming inclination towards reduced lending rates underscores the challenges faced by Nigerians in accessing affordable credit, which is essential for stimulating economic growth and personal financial stability.​

High lending rates have been a persistent issue in Nigeria, often cited as a barrier to business expansion and consumer spending. The CBN’s survey highlights the urgency for policymakers to address these concerns, as lower interest rates could potentially lead to increased investment, job creation, and overall economic development.​

In response to these findings, financial analysts suggest that the CBN may need to consider adjusting its monetary policy to accommodate the public’s preference for lower lending rates. Such adjustments could involve reducing the Monetary Policy Rate (MPR), which serves as a benchmark for commercial lending rates, thereby making loans more affordable for borrowers.​

However, it’s important to note that any decision to lower interest rates must be balanced against the need to control inflation. Reducing rates without careful consideration could lead to increased money supply and higher inflation, which may counteract the benefits of more accessible credit. Therefore, the CBN faces the complex task of aligning its monetary policies to support economic growth while maintaining price stability.

The survey’s findings also highlight the need for enhanced financial literacy among Nigerians. A better understanding of how interest rates affect the economy can empower individuals to make informed decisions about borrowing and saving, thereby contributing to more effective monetary policy implementation.​

In conclusion, the CBN’s survey reflects a strong public desire for reduced lending rates, emphasizing the necessity for policymakers to carefully evaluate and potentially recalibrate monetary policies to foster an environment conducive to economic growth and financial well-being.