A new report from the World Bank’s Global Findex 2025 reveals that 59% of adults in low- and middle-income economies, including Nigeria, borrowed money in 2024, either through formal, semi-formal, or informal channels to take care of their needs.
The findings highlight the evolving landscape of credit access and note persistent disparities in financial inclusion across regions.
The survey, which covered 139 economies, asked respondents whether they borrowed money in the past year and identified the sources of those funds.
While borrowing was widespread, only 24% of adults—or 40% of borrowers—accessed formal credit, such as loans from banks, credit unions, mobile money providers, or credit cards.
“Credit is a vital tool for financial resilience and opportunity, but access remains uneven,” the report notes.
Breakdown of Borrowing Channels
- Formal Borrowing: 24% of adults borrowed through banks, credit cards, or mobile money accounts
- Semi-Formal Borrowing: 5% borrowed from savings clubs or rotating credit associations
- Informal Borrowing: 31% borrowed from family or friends, with 21% relying solely on this method
- Other Sources: 12% tapped into options like buy-now-pay-later services or grocery credit
The report found that informal borrowing was more prevalent in regions such as Sub-Saharan Africa, South Asia, and the Middle East and North Africa, where over 45% of adults borrowed informally only. In contrast, just 19% of adults in East Asia and the Pacific relied solely on informal credit.
Disparities by Gender, Income, and Location
The report highlights significant gaps in borrowing behaviour. Women were more likely than men to borrow informally only in all regions except East Asia and the Pacific.
Adults in the poorest 40% of households were 15 percentage points more likely to borrow informally than those in the wealthiest 60%.
The report noted that rural borrowers were 19 percentage points more likely than urban residents to rely on informal credit, while those out of the workforce were more likely to borrow informally than wage or self-employed individuals.
Mobile Money: A Growing but Limited Credit Channel
Mobile money continues to play a growing role in formal borrowing, especially in Sub-Saharan Africa, where 7% of adults borrowed through mobile money accounts in 2024.
Although this figure remains unchanged from 2021, mobile money now accounts for nearly 60% of all formal borrowing in the region.
Looking at the breakdown, in Kenya, 32% of adults borrowed via mobile money, with 25% relying solely on this method, while in Ghana, 22% borrowed through mobile money, driving an overall increase in formal borrowing.
Uganda saw 22% of borrowings done via mobile money, with most relying exclusively on this channel.
The report notes that mobile money loans are typically small, short-term, and carry high effective interest rates, but they can modestly improve consumption and financial well-being.
“As mobile phone ownership and financial services expand, mobile money borrowing offers new opportunities—but its impact is limited and not transformative,” the report states.
Credit Cards and Formal Lending Trends
Credit card usage remains low in developing economies, with only 15% of adults using one in the past year. However, in some countries, credit cards dominate formal borrowing due to their dual role as payment and credit instruments.
Formal borrowing has grown over time—from 15% in 2014 to 24% in 2024—but regional disparities persist.
In East Asia and Pacific, 34% of adults borrowed formally. But in the Middle East and North Africa / Sub-Saharan Africa, just 12% borrowed formally, while in Latin America, Europe, and Central Asia, formal credit is the most common source, used by over half of borrowers.
The report concluded that despite increased borrowing, formal credit remains less common than saving or using accounts for payments.
