High interest rates have overtaken insecurity and unreliable power as the chief obstacle for Nigerian businesses, according to the Central Bank of Nigeria’s June 2025 Business Expectation Survey.
Firms assigned a constraint index score of 75.6 to interest costs—just ahead of insecurity at 75.2 and insufficient power supply at 74.3. The survey sampled 1,900 companies across industry, agriculture, and service sectors between June 16 and 20.
This shift reflects growing pressure from the apex bank’s tight monetary policy, which has driven benchmark interest rates to 27.5 percent after an 875‑basis‑point hike. Many firms, particularly SMEs, now face lending rates exceeding 30 percent, squeezing access to affordable credit.
Other major challenges businesses flagged include high bank charges (73.2), steep taxes (68.9), an unfavourable economic climate (68.7), and vague regulatory frameworks (67.4). Issues such as poor infrastructure (62.4) and political instability (62.5) ranked lower, suggesting that economic and financial burdens now outweigh political risks.
Despite these constraints, the Business Confidence Index stood at 20.7 in June and is expected to rise to 41.3 within six months. Confidence varies widely by region: the South‑East recorded the lowest optimism at 4.4, while the North‑East posted the highest at 37.1. Businesses also anticipate a stronger naira ahead, even as borrowing costs remain high.
The report signals a pivotal shift in the business risk landscape—economic and financial pressures are now more potent than traditional structural issues.
