Businesses Urge Banks to Cut Lending Rates After CBN Lowers MPR to 23%

Businesses and private-sector groups have urged commercial banks to reduce lending rates after the Central Bank of Nigeria cut its Monetary Policy Rate from 26.5% to 23%. The CBN announced the 350-basis-point reduction after its 307th Monetary Policy Committee meeting in Abuja. Governor Olayemi Cardoso cited moderating inflation, improved foreign exchange conditions and stronger external reserves as factors behind the decision. Business leaders said the cut will only bring relief if banks lower the cost of credit for borrowers, especially small and medium-sized enterprises. They argued that cheaper loans could support production, investment and job creation, but warned that insecurity, political uncertainty and banks' preference for government securities could limit lending to smaller firms. The CBN said the adjustment is a recalibration of the policy rate rather than a broad shift towards monetary easing. Nigeria's headline inflation fell to 15.39% in August, while external reserves stood at $55.25 billion as of September 18.

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