The Central Bank of Nigeria (CBN) has identified the high interest rate in Nigeria as the leading challenge facing businesses, according to its June 2025 Business Expectations Survey (BES).
Conducted from June 16–20 by the CBN Statistics Department, the survey shows that the cost of credit has overtaken insecurity and power supply as top operational burdens.
A total of 1,900 firms across sectors—including construction, agriculture, wholesale/retail, and services—participated in the survey.
Businesses assigned a constraint index score of 75.6 to high interest rate, edging out insecurity (75.2) and inadequate electricity (74.3).
This result signals mounting pressure on corporate finances, especially for small and medium-sized enterprises (SMEs) struggling to access affordable credit.
Since early 2024, the CBN has raised its Monetary Policy Rate (MPR) multiple times to curb inflation and stabilize the naira.
The MPR currently stands at 27.5%, with commercial lending rates often exceeding 30%, placing credit further out of reach for many.
Despite ongoing insecurity in the North-West and unstable electricity nationwide, borrowing costs now pose the most immediate risk.
Other significant challenges reported include high bank charges (73.2), excessive taxation (68.9), and a weakening economic climate (68.7).
Poor infrastructure, unclear economic laws, and political instability also featured in the survey but ranked slightly lower in urgency.
CBN noted: “Business constraints in June 2025 were largely economic and financial rather than political or security-related.”
Interestingly, the Business Confidence Index (BCI) for June stood at 20.7, showing optimism about improved conditions within the next six months.
CBN projections suggest this index may rise to 41.3 by year-end as expectations for easing inflation and business growth gain momentum.
For context, read more about Nigeria’s inflation trends and SME policy reforms recently introduced to ease financial burdens.
