NIGERIA — Small and medium sized enterprises in Nigeria are set to feel the pinch as the Central Bank of Nigeria (CBN) hikes its benchmark interest rate, known as the Monetary Policy Rate (MPR).
The rate has increased by 25 basis points, from 18.5% to 18.75%, meaning costs of funds for businesses is set to rise higher, potentially leading to lending costs as high as 27%.
The CBN has defended the rate increase, stating that previous rate hikes have “moderated the rate of inflation”. However, for MSMEs operating in this challenging economic climate, the increased costs may have a significant impact.
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