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The first time I told an American friend that Nigerians buy houses outright, no mortgage, no 20-year payment plan, he looked at me like I had just described a strange something. “You mean no loan?” he asked. No, no loan, I responded.
In his world, that’s almost unimaginable. In Nigeria, it has always been the way of buying things. You save, you build, you buy. No bank breathing down your neck. No monthly pressure. But lately, something has been shifting. The culture of credit is also starting to grow in Nigeria.
Previously, it used to be subtle. We say, “Mama, I go pay you at the end of the month,” at the provisions store down the road. We say, “My brother, hold this for me, I go pay” at the mechanic shop, the market, the salon. We’ve always borrowed. But it was built on trust, familiarity and community. You often owed a person, not a platform. Even when you burrow from organisations or corporate bodies, you must have been part of the corporate body for at least 6 months. There was eye contact involved.
However, things have changed. We don’t just owe people anymore. We owe apps and institutions. It is almost everywhere now. That iPhone your colleague just unboxed might be bought on an instalment plan. That keke you entered this morning might be hire-purchased. The TV and fridge in someone’s sitting room might be from a “pay small small” scheme. Even rent, which used to be strictly cash upfront, is now entering the credit conversation.
Digital loan platforms and apps have made it easy to access money. They offer loans without long waits or collateral. All you need most times is your phone, your BVN, and boom, money in your account. Debt is being rebranded as access. If you’ve been paying attention, you’ll know exactly why this shift is happening so fast.
What’s driving this shift is pressure. The Nigerian economy has, in recent years, become increasingly unforgiving. Prices rise faster than incomes. Salaries remain stagnant while the cost of living stretches further out of reach. Inflation is no longer an abstract economic term; you feel it in the market, in transport fares, in rent conversations, leaving little room to plan ahead.
To live, credit becomes a practical option for many. It allows people to meet immediate needs. But this comes with risks. Interest rates on many digital loans are high, and repayment timelines are short. What starts as a quick solution can become difficult to manage, especially when income is unstable. Missed payments attract penalties, and debt builds up faster. At the same time, inflation continues to push prices upward. This reduces purchasing power and makes it harder to repay what is owed. The result is a cycle where people rely on new loans to cover old ones. Credit, in this case, is less about choice and more about coping with a difficult economy.
While the credit scheme has allowed people to now get things they need to work and earn, phones, laptops, and equipment, without waiting two years to save up, and small businesses can stock goods, move faster, and take opportunities they would have otherwise missed, it is boxing many Nigerians in a cycle of debt.
The credit system does not mean people can now afford to buy things. They are, however, incapacitated. They borrow a loan to pay a previous loan. As a country, Nigeria doesn’t have stable long-term mortgage systems, low-interest credit infrastructure, or a strong credit scoring culture yet. In America, for instance, people use credit to build wealth and leverage the future. In Nigeria, many people are using credit to cope with the present. To get by. To keep up. To move forward even when things are tight.
The post Victor Ogu: Is Nigeria Entering Its Credit Era As “Pay Small Small” Schemes Become Popular? appeared first on BellaNaija - Showcasing Africa to the world. Read today!.
