Nigeria’s Finance and Insurance sector posted a real-term growth of 16.13% in the second quarter of 2025, marking a significant leap in economic activity and signaling renewed momentum in the country’s financial ecosystem.
The latest figures from the National Bureau of Statistics (NBS) show that this growth is 15.83 percentage points higher than the rate recorded in Q2 2024 and 1.09 points above the previous quarter.
The sector is composed of two key subsectors: Financial Institutions and Insurance. Financial Institutions remained dominant, contributing 87.97% of the sector’s real output, while Insurance accounted for 12.03%. This distribution reflects the continued strength of banking, fintech, and capital market activities in Nigeria.
Despite the annual surge, quarter-on-quarter real growth declined by 7.13%, suggesting a temporary slowdown in output, possibly due to seasonal factors or short-term market adjustments.
GDP Contribution
In real terms, the Finance and Insurance sector contributed 3.23% to Nigeria’s GDP in Q2 2025. This marks an increase from 2.89% in the same quarter of 2024, though slightly lower than the 3.60% recorded in Q1 2025.
“Growth in this sector in real terms totaled 16.13%, higher by 15.83% points from the rate recorded in the 2024 second quarter and higher by 1.09% points from the rate recorded in the preceding quarter,” the report says.
“Quarter-on-quarter growth in real terms stood at -7.13%. The contribution of Finance and Insurance to real GDP totalled 3.23%, higher than the contribution of 2.89% recorded in the second quarter of 2024 by 0.33% points, and lower than 3.60% recorded in Q1 2025 by 0.38% points.”
The figures underscore the sector’s growing role in the broader economy, even as quarterly fluctuations persist.
In nominal terms, the sector expanded by 63.66% year-on-year, with Financial Institutions growing by 65.24% and Insurance by 53.00%. This nominal growth was 30.96 percentage points higher than Q2 2024 and 42.65 points above Q1 2025. The sector’s nominal GDP contribution rose to 4.57%, up from 3.33% a year earlier and 3.07% in the previous quarter.
Economic Implications
The strong nominal growth and rising GDP contribution suggest a resilient financial sector, buoyed by increased digital adoption, expanding credit access, and insurance penetration.
However, the dip in quarter-on-quarter real growth may prompt stakeholders to examine short-term challenges such as inflationary pressures and regulatory shifts.
What You Should Know
- Looking at the bigger picture, Nigeria’s Gross Domestic Product (GDP) grew by 4.23% year-on-year in real terms in the second quarter of 2025.
- This marks a stronger performance than the 3.48% recorded in the corresponding period of 2024.
- The NBS report shows that aggregate GDP at basic prices stood at N100.73 trillion in nominal terms, compared with N84.48 trillion in Q2 2024, representing a nominal growth of 19.23% year-on-year.
