Following the Central Bank of Nigeria’s (CBN) decision to increase the monetary policy rate (MPR) to 22.75 percent in February 2024, fintech companies operating in the digital savings space have begun raising their interest rates.
Platforms like Cowrywise have notified customers of the changes, with some offering up to 14 percent per annum on savings plans, a significant increase from previous rates around 8 percent. However, these companies caution that market fluctuations may affect future interest rates.
Simultaneously, digital lenders are preparing to raise their lending rates in response to the MPR hike. Lenders cite increased capital costs and challenges in securing new funding as reasons for the anticipated rate adjustments. Higher borrowing costs are expected to impact many Nigerians who rely on digital lenders for essential cash needs.
Source: Business Day