Lagos, Sept. 23, 2026 – The Centre for the Promotion of Private Enterprise [CPPE] has urged Nigerian banks to reflect the new monetary policy environment in their pricing of credit.
The private think tank gave the advice in a policy brief it issued on Tuesday after the announcement of reduction of the Monetary Policy Rate (MPR) by the Central Bank of Nigeria.
The CPPE said the banks should reflect the new lending rates on both new and existing facilities progressively downwards in tandem with the new monetary policy stance.
“Without meaningful transmission to borrowers, the impact of the policy adjustment on investment and economic growth would be limited,” it said.
The CPPE commended the apex bank for the recalibration of the monetary policy framework, stressing that the magnitude of the adjustment was largely unexpected and represented a significant shift from the prolonged restrictive monetary policy regime.
“It signals an important rebalancing of monetary policy towards supporting growth, investment and economic recovery, while preserving price and financial-system stability.
“The review of the asymmetric corridor around the MPR from +50/-450 basis points to +50/-300 basis points further reinforces the recalibration of the monetary policy architecture.
“The CPPE considers the adjustment timely given the improving inflation trajectory and the growing costs of an excessively restrictive monetary environment,” it said.
The CPPE said the reduction of the MPR to 23% should, therefore. be viewed not merely as monetary easing, but as an important realignment of the policy rate with prevailing macroeconomic and financial-market conditions.
“The decision is particularly positive for the real sector, where high financing costs have become a major constraint on investment, production, working capital and job creation.
“For many businesses, commercial lending rates have remained at levels that are difficult to reconcile with productive investment, particularly in manufacturing, agriculture, construction, logistics and other sectors with relatively long investment cycles and tight margins,” it said.
The CPPE, however, said that lower interest rates alone could not deliver sustainable economic recovery as a significant proportion of Nigeria’s inflationary pressures remained structural and supply-driven.
“Energy costs, logistics bottlenecks, insecurity, food-production constraints, infrastructure deficits and high regulatory costs continue to exert considerable pressure on prices and business operating costs.
“The current monetary recalibration should therefore be complemented by stronger fiscal and structural interventions aimed at reducing production costs, improving productivity, strengthening food and energy security, and expanding domestic productive capacity.
“This is critical to ensuring that monetary easing translates into investment and additional output rather than renewed inflationary pressure,” it said.
The CPPE said it considered the September MPC decision a significant and positive turning point in the monetary policy cycle.
“The 350-basis-point adjustment should help reduce financing pressures on businesses, strengthen investment prospects, support economic growth and progressively moderate the government’s domestic debt-service burden.
“But the success of the policy should ultimately be judged by four outcomes: the extent of reduction in commercial lending rates; the response of private investment and credit to the productive sectors; the behaviour of inflation; and the stability of the foreign-exchange market,” it said.