Private sector credit extension (PSCE) rose by N$662.2 million in March 2025, representing a monthly growth rate of 0.56% and pushing total credit outstanding to N$118.67 billion.
IJG Securities stated in its latest market update that, on an annual basis, PSCE growth accelerated to 5.3%—the highest level recorded since March 2020.
“All categories recorded monthly gains, except for mortgage loans. Credit extended to both corporations and individuals ticked up in March. Annually, credit to corporations grew by 8.2% y/y, while credit to individuals grew by 2.8% y/y,” noted IJG.
Growth in PSCE was partly tempered by the slowdown in mortgage lending, which contracted on a monthly basis for both corporates and households, the report noted.
Additionally, claims on the non-resident private sector declined by 6.6% month-on-month, further weighing on overall credit growth.
Meanwhile, credit to individuals rose modestly by 0.1% m/m in March, raising the total amount outstanding to N$68.72 billion.
“On an annual basis, PSCE to individuals grew by 2.8%, an improvement from the 2.2% y/y growth seen in March last year,” IJG Securities reported.
Among lending categories, instalment credit was the only segment to show monthly growth, increasing by 1.6% m/m and a robust 14.5% y/y.
“Loans and advances fell by 0.1% m/m, mainly due to a 0.6% m/m drop in overdraft facilities,” IJG Securities said.
Mortgage loans and ‘other loans and advances’ each dipped by 0.1% m/m. On an annual basis, overdraft facilities showed the only decline among categories, down by 12.5% y/y.
Meanwhile, mortgage loans increased by 0.6% y/y, and ‘other loans and advances’ rose by 7.9% y/y.
Moreover, credit to corporates rose sharply by 1.3% m/m and 8.2% y/y in March—significantly above the two-year average growth rate of 1.6% y/y. This marks the strongest annual growth since September 2022, IJG Securities said.
The firm noted that the gains were broad-based, excluding corporate mortgage loans, which contracted by 2.8% m/m and 2.3% y/y.
“Total loans and advances grew by 1.1% m/m and 6.5% y/y, supported mainly by a sharp rise in ‘other loans and advances’, which increased 3.5% m/m and 14.8% y/y,” IJG Securities added.
Overdraft facilities rose 3.3% m/m and 4.6% y/y—marking the highest annual growth in that segment since July 2023. Instalment credit also posted notable gains, increasing 2.1% m/m and 20.6% y/y.
This comes as the average liquidity position of commercial banks declined by N$473.1 million to N$9.38 billion in March.
According to the Bank of Namibia, the dip in liquidity was mainly due to outflows for foreign payments, while the decline in reserves was attributed to increased imports and government-related foreign payments.
Despite liquidity pressures, credit activity remains buoyant, particularly in the corporate sector.
“Corporate PSCE growth is showing signs of returning to pre-pandemic levels, signalling a cautiously optimistic outlook for sustained credit momentum in the coming months,” IJG said.
