Nigerian manufacturers paid 32% interest on loans despite easing rates

Nigerian manufacturers continued to pay more than 30% on loans across every major industrial sector in 2025, despite a modest decline in borrowing costs.

Data from the Manufacturers Association of Nigeria put the average administered interest rate at 32.1%, down from 35.6% in 2024. The average stood at 32.5% in the first half of 2025 before easing to 31.8% in the second half.

The chemical and pharmaceutical sector recorded the lowest average rate, at 30.4%. Wood and wood products manufacturers paid 30.8%, while textile, clothing, carpet, leather and footwear companies faced 31.6%.

Rates averaged 32.3% for metal, iron, steel and fabricated-metal producers, and 32.4% for electrical and electronics manufacturers. Food, beverage and tobacco companies paid 32.5%, while plastic, rubber and foam producers paid 32.6%. Motor vehicle and miscellaneous assembly, along with pulp, paper, printing, publishing and packaging, recorded 32.8%. Non-metallic mineral products faced the highest average cost, at 33%.

The association attributed the moderate easing to improving economic conditions, including softer headline inflation, more stable energy prices and continued appreciation of the local currency. It said financing costs nevertheless remained high enough to hinder manufacturing competitiveness and output growth, limiting companies’ ability to finance production, working capital and new capacity.