Credit to government surges 65.6% to N39.6trn

•As currency outside banks drops 12% to N5.08tr

By Babajide Komolafe & Elizabeth Adegbesan

Credit to the government rose by 65.6 per cent year-on-year, YoY, to N39.6 trillion in April 2026 from N23.9 trillion in April 2025, driven by increased borrowing to finance the 2026 budget deficit.

The Central Bank of Nigeria, CBN, disclosed this in its latest Money and Credit Statistics.

Under the Appropriation Act 2026, the Federal Government plans to borrow N29.2 trillion, to fund the gap between the   revenue of N68.32 trillion and expenditure of N36.87 trillion.

Vanguard analysis showed that   the Federal Government increased borrowing from domestic investors by 7.4 per cent to N8.1 trillion in   the first quarter of 2026 from   N7.5 trillion in the same period of 2025.

The CBN data also showed that credit to the private sector rose by 3.25 per cent to N80.6 trillion in April 2026 from N78.06 trillion in April 2025.

Consequently, net domestic credit rose by 17.8 per cent to N120.2 trillion in April 2026 from N102 trillion in the corresponding period last year.

Following the same trend, Nigeria’s broad money supply (M2) increased by 4.8 per cent YoY to N124.98 trillion in April 2026 from N119.2 trillion recorded in April 2025, reflecting improved liquidity in the financial system.

Further breakdown of the money supply components showed that   currency outside banks declined by 12.2 per cent to N5.08 trillion in April 2026 from N5.7 trillion in the corresponding period of 2025, indicating increased use of banking channels and electronic payment systems.

However, demand deposits (current accounts)   increased by 6.3 per cent to N38.7 trillion from N36.4 trillion during the review period.

Also quasi-money   increased by 3.8 per cent to N81.2 trillion in April 2026 from N78.2 trillion in April 2025. Quasi money includes money in savings accounts, time deposits, treasury bills and other money market instruments.    

Narrow money, which includes currency in circulation and current accounts,   also grew by 7.09 per cent to N43.8 trillion from N40.9 trillion. 

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