Inflation Moderates to 14.45% as Private Sector Urges Credit Access for Small Businesses

Nigeria’s inflation rate eased to 14.45 per cent, providing cautious optimism for the economy as organised private sector groups renewed calls for stronger credit support for micro, small and medium enterprises to sustain growth and employment. Reports by Punch and other Nigerian news outlets indicate that the moderation in inflation reflects a slowdown in price increases across key consumer segments, although underlying economic pressures persist.

According to data released by the National Bureau of Statistics, the latest inflation figure represents a decline compared to the previous period, driven largely by a moderation in food and core inflation components. Analysts noted that the easing offers temporary relief to households and businesses that have faced prolonged pressure from rising prices, weakened purchasing power, and elevated operating costs.

Despite the slowdown, inflation remains at a level that continues to challenge economic recovery, particularly for MSMEs, which account for a significant share of employment and productive activity in Nigeria. The Organised Private Sector of Nigeria said the inflation data underscores the need for targeted policy interventions to support small businesses struggling with high borrowing costs and limited access to finance.

OPS representatives reportedly stressed that MSMEs remain the most vulnerable segment of the economy, often bearing the brunt of inflationary pressures through increased input costs, energy expenses, and logistics challenges. While easing inflation could help stabilise prices, they argued that without affordable credit, many small businesses would be unable to expand operations or even sustain current levels of activity.

The private sector body noted that lending rates remain high, limiting the ability of MSMEs to access loans needed for working capital and investment. According to OPS, commercial bank credit to small businesses remains insufficient relative to their contribution to the economy, creating a financing gap that constrains growth and job creation.

Reports indicated that OPS called on financial regulators and policymakers to strengthen existing credit intervention schemes and introduce new financing windows tailored to MSMEs. These include concessional loans, credit guarantees, and risk-sharing mechanisms that would encourage banks to lend more actively to small businesses without excessive collateral requirements.

Economic analysts observed that the moderation in inflation could create room for improved macroeconomic stability if sustained. However, they cautioned that inflation remains sensitive to factors such as food supply disruptions, exchange rate volatility, and energy costs. As a result, they said easing inflation alone may not be sufficient to revive MSME growth without complementary credit and structural reforms.

The inflation slowdown was also linked to recent improvements in supply chains and agricultural output, which helped moderate food prices. However, stakeholders warned that structural challenges in agriculture, including insecurity, poor storage facilities, and high transportation costs, could reverse these gains if not addressed.

OPS further argued that supporting MSMEs is critical to cushioning the social impact of inflation. Small businesses employ millions of Nigerians and serve as a key source of income for households. When MSMEs struggle, analysts said, unemployment rises and poverty deepens, undermining broader economic stability.

Reports also highlighted that MSMEs have faced increased pressure from rising energy costs, especially fuel and electricity prices, which have significantly raised production and operating expenses. Even with easing inflation, these structural costs continue to weigh heavily on business margins, prompting calls for targeted relief measures.

The private sector group urged the government to complement monetary policy efforts with fiscal and structural reforms that lower the cost of doing business. These include improved infrastructure, stable power supply, and simplified regulatory processes that reduce compliance costs for small enterprises.

Economists noted that while inflation easing to 14.45 per cent is a positive signal, it remains above levels considered comfortable for sustained economic growth. They stressed that policymakers must remain cautious and avoid premature tightening or loosening that could destabilise prices.

The OPS also called for better coordination between monetary authorities and development finance institutions to ensure that MSMEs benefit from targeted credit programmes. They argued that access to finance should be linked with capacity-building initiatives to improve financial literacy, record-keeping, and business management among small business owners.

Reports indicated that some existing intervention programmes have helped MSMEs in agriculture, manufacturing, and services, but coverage remains limited relative to demand. Stakeholders urged authorities to scale up successful schemes and improve transparency to ensure funds reach intended beneficiaries.

The easing inflation has also renewed debate on interest rate policy, with some analysts suggesting that sustained moderation could eventually support lower borrowing costs. However, they cautioned that any policy shift must consider inflation expectations and external economic risks.

OPS maintained that supporting MSMEs through affordable credit is essential not only for economic growth but also for social stability. By enabling small businesses to expand and hire, credit access can help reduce unemployment and support inclusive development.

As Nigeria navigates a challenging economic environment, the combination of easing inflation and targeted MSME support is seen as critical to sustaining recovery. Stakeholders believe that while the inflation slowdown offers hope, meaningful progress will depend on translating macroeconomic improvements into tangible support for businesses and households.

In conclusion, the easing of inflation to 14.45 per cent has provided cautious relief, but the Organised Private Sector insists that stronger credit support for MSMEs is urgently needed. Without improved access to affordable financing, stakeholders warn that the benefits of easing inflation may not fully translate into growth, job creation, and long-term economic stability.