Cash flow, not collateral, should drive lending to Nigerian businesses, says Moniepoint CEO

Moniepoint says Nigerian lenders should assess businesses based on how they earn and move money rather than the collateral they can pledge, as formal credit use among Nigerian adults increased to 10% in 2026 from 6% in 2023.

The company made the case following the release of the EFInA 2026 Access to Financial Services in Nigeria (A2F) Survey, arguing that the findings support its cash flow-based approach to lending.

Moniepoint Group CEO, Tosin Eniolorunda, also linked broader financial participation to trust, saying, “Access to financial services means little without trust,” as the company pushes for wider use of transaction data in lending decisions.

Moniepoint pushes cash flow lending:

Moniepoint said expanding cash flow-based lending across the financial sector could help Nigeria move closer to the National Financial Inclusion Strategy target of 40% formal credit penetration.

The company argues that transaction data can provide lenders with a clearer picture of businesses that may generate regular cash flows but lack conventional collateral.

Eniolorunda said trust must remain central to efforts to deepen access to financial services.

• “Access to financial services means little without trust.”

Moniepoint’s own survey found that 83% of its users reported improved quality of life, while 85% said they had greater confidence in achieving their financial goals.

Its inaugural Impact Report also said the company disbursed more than $700 million to MSMEs in 2025, with three out of four borrowers accessing formal business credit for the first time; these are company-reported figures and have not been independently verified.

Formal credit rises to 10%:

The EFInA survey covered 18,679 adults across all 36 states and the FCT, with data collected between April and June 2026. It found that formal financial inclusion reached 73%, equivalent to approximately 87.2 million adults, compared with 64% in 2023 and above the 70% NFIS target.

• Formal credit use also increased to 10% from 6% in 2023, although it remains substantially below the 40% target cited in the report.
• Among adults who trusted their financial-services provider, 96.9% had transacted within the previous 90 days, compared with 65.6% among those who did not trust their provider.
• Formal inclusion among women business owners increased from 67.5% to 76.3%, while inclusion among women farmers rose from 42.7% to 53.6%.
• Moniepoint reported that businesses receiving its loans recorded a 36% increase in average transaction value.

The company also said women accounted for 36% of its loan book, compared with an industry benchmark of between 15% and 25%.

Nairametrics previously reported Eniolorunda’s argument that payment infrastructure and transaction data could be used to extend credit to small and informal businesses traditionally excluded from formal lending.

Coping loans temper credit gains:

The expansion in formal credit comes with signs of financial vulnerability among borrowers. EFInA CEO, Foyinsolami Akinjayeju, had previously said that access should no longer be the sole measure of progress, while Research Lead, Dr Oluwatomi Eromosele, said existing financial relationships should become pathways to credit, protection, investment and financial security.

• The A2F data analysed by Nairametrics, nevertheless, shows that increased borrowing coincided with a shift towards coping and consumption credit.
• Coping and consumption loans accounted for 40.8% of formal borrowing in 2026, up from 31.7% in 2023, overtaking productive enterprise borrowing at 34.3%.
• About 45.8% of formal-credit users reported some or serious repayment stress.
• Only 30.7% of formally included adults were financially healthy, leaving approximately 60.4 million adults financially vulnerable or merely coping.

Formal inclusion stood at 85% in urban areas compared with 58% in rural areas, while the South West recorded 96.4% against 61.4% in the North East.

The Moniepoint argument therefore rests on using transaction and cash-flow data to reach borrowers that collateral-based lending may exclude, while the EFInA survey found that expanding credit increasingly financed short term financial needs rather than productive activity making underwriting quality as important as access.