Nigeria’s private sector external debt climbed by 179.6 per cent between 2018 and 2025, reaching $54.48bn as businesses increasingly rely on foreign borrowing, according to the World Bank.
The figure, contained in the bank’s International Debt Report 2026, represents almost three times the $19.49bn owed by Nigerian private companies to foreign creditors in 2018.
The report put private sector nonguaranteed external debt at $54.476bn as of December 2025. This category covers loans obtained by private businesses from foreign banks, investors and other lenders without a government or public institution guaranteeing repayment.
The World Bank explained that a country’s total external debt consists of public and publicly guaranteed borrowing, private nonguaranteed debt and short-term obligations.
Public and publicly guaranteed debt covers long-term external loans owed by government institutions and other public entities, including state-owned enterprises. Short-term debt refers to obligations with an original repayment period of one year or less.
The growth in private companies’ foreign debt outpaced the increase in government-backed external borrowing over the seven-year period.
Public and publicly guaranteed external debt rose by 155.5 per cent, from $24.422bn in 2018 to $62.4bn in 2025, compared with the 179.6 per cent increase recorded by private sector borrowers.
The data also show that private sector borrowing is accounting for a larger share of Nigeria’s external debt profile. In 2018, nonguaranteed private debt was equivalent to 79.8 per cent of public and publicly guaranteed external debt. By 2025, the proportion had increased to 87.3 per cent.
Nigeria’s overall external debt, including government borrowing, private sector loans and short-term obligations, expanded from $46.238bn in 2018 to $145.015bn in 2025.
The report also drew attention to the higher cost and shorter repayment periods associated with loans from private foreign creditors.
New loans obtained by Nigeria from private external lenders in 2025 carried an average interest rate of 9.6 per cent, significantly higher than the 1.9 per cent charged on borrowing from official creditors, including foreign governments and multilateral development institutions.
Private creditors also offered an average repayment period of 12 years, compared with 25 years for loans from official sources.
The figures highlight the growing exposure of Nigerian businesses to international lenders, as well as the relatively expensive terms attached to private external financing.
