Nigeria’s finance and insurance sector is growing at more than twice the pace of the broader economy, raising questions about what is driving the expansion and how much of it is translating into stronger economic activity. The sector grew by 9.29 percent in real terms year-on-year in the second quarter of 2026, according to the National Bureau of Statistics (NBS), compared with 4.43 percent growth recorded by the Nigerian economy during the same period.
The performance, however, represented a slowdown from the 16.13 percent real growth recorded by the finance and insurance sector in the second quarter of 2025, although it was 0.74 percentage points higher than the preceding quarter. The sector’s performance was driven by its two major components, financial institutions and insurance, with financial institutions accounting for 87.22 percent of the sector in real terms, while insurance accounted for 12.78 percent.
In nominal terms, the finance and insurance sector grew by 11.88 percent year-on-year in the second quarter, comprising 10.92 percent growth in financial institutions and 18.88 percent growth in insurance. Despite its stronger growth rate, the sector’s contribution to real GDP stood at 3.37 percent in the second quarter, up from 3.23 percent a year earlier but below the 3.76 percent recorded in the first quarter of 2026.
The figures show that financial services are expanding faster than the wider economy, even as the sector’s overall contribution to economic output remains relatively modest. The divergence comes against the backdrop of significant changes in Nigeria’s banking industry, particularly the completion of the recapitalisation exercise that resulted in 33 better-capitalised institutions.
Aloysius Uche Ordu, a member of the Monetary Policy Committee (MPC), said the completion of the banking sector recapitalisation had strengthened the system’s capacity to intermediate and support the authorities’ ambition of building a trillion-dollar economy.