Nigeria’s Low Credit Penetration Hindering Entrepreneurial Growth – Expert

An economist has raised concerns over Nigeria’s low level of credit access, warning that it poses a significant threat to the country’s entrepreneurial growth and broader economic development.

Speaking at the maiden collaborative lecture hosted by Kwara State University, Mr Ahmed Popoola stated that Nigeria’s credit penetration rate currently stands at just 13 per cent, a figure he described as insufficient for building a thriving entrepreneurial economy.

The lecture, organised by the Faculty of Management and Social Sciences in collaboration with the Centre for Advancement and Industrial Collaboration, focused on the theme “Finance, Entrepreneurship, and the Infrastructure of Trust.”

Entrepreneurial Growth: Limited Access to Finance for SMEs

Popoola, who serves as Managing Director and Chief Executive Officer of CRC Credit Bureau Limited, noted that out of approximately 35.6 million registered enterprises in Nigeria, only about two million have access to formal credit facilities. According to him, this gap continues to limit the ability of businesses to scale, innovate, and contribute meaningfully to national development.

He emphasised that access to finance remains a critical driver of economic prosperity, affecting individuals, businesses, and governments. Without adequate financial support, he said, entrepreneurship cannot fully translate into economic growth.

Call for Stronger Financial and Data Systems

Additionally, the financial expert also highlighted structural challenges within Nigeria’s financial system, particularly the fragmentation of identification frameworks. He called for the integration of multiple identification systems, including tax identification numbers, Bank Verification Numbers (BVN), and other official records, into the National Identification Number (NIN) to improve credit accessibility and financial inclusion.

While advocating increased data sharing to strengthen credit systems, Popoola stressed the importance of safeguarding personal information. He warned that as financial services become more digitised, protecting sensitive data from misuse and unauthorised access must remain a top priority.

Stakeholders Urged to Support Credit Infrastructure

Also, he urged the government to either mandate or incentivise institutions such as telecommunications companies, power distribution firms, insurance providers, and tax authorities to share relevant data with credit bureaus. This, he explained, would help build a more reliable credit infrastructure and expand access to financing for small businesses.

Earlier in his remarks, the Dean of the Faculty of Management and Social Sciences, Prof. Rahman Mustapha, described the lecture as a strategic effort to bridge the gap between academia and industry. He noted that the theme was particularly relevant in a time when financial innovation and institutional trust are essential for sustainable development.

Entrepreneurial Growth: Unlocking Growth Through Credit Access

Similarly, the Vice-Chancellor of the university, Prof. Jimoh Shaykh-Luqman, reiterated the institution’s commitment to connecting theoretical knowledge with real-world applications. He added that improving public understanding of credit systems and business financing is key to strengthening Nigeria’s entrepreneurial ecosystem.

Analysts say addressing Nigeria’s credit gap could unlock significant opportunities for small and medium-sized enterprises, positioning them as stronger contributors to economic growth and job creation.