Household debt in Namibia rose sharply in 2025, increasing by N$72.2 billion to N$883.2 billion from N$811.0 billion in 2024, while growth in corporate borrowing moderated, signalling a shift in private sector credit behaviour, according to Simonis Storm.
The firm said private sector credit extension eased slightly to 4.4% year-on-year in December 2025, down from 4.5% in November.
However, the annual average growth rate of 4.9% for 2025 marked a notable improvement from 2.5% in 2024 and 2.4% in 2023.
Simonis Storm Economist Almandro Jansen said households accounted for 56.9% of total private sector credit, while corporates made up 41.7% and non-residents 1.3%.
Instalment sale and leasing, which is largely asset-backed lending, continued to dominate household borrowing, growing by 15.5% year-on-year in December. This was supported mainly by demand for vehicles and equipment.
Mortgage lending, however, remained subdued, rising only marginally to N$550.0 billion from N$547.0 billion in 2024, reflecting ongoing affordability constraints.
Other loans and advances increased to N$153.7 billion from N$143.3 billion, while overdraft credit declined to N$28.8 billion from N$33.0 billion.
“This trend underscores persistent financial pressure, particularly among lower-income consumers,” Jansen said.
He added that the recovery in household credit remains slow and selective, with easing interest rates, rising living costs and weak wage growth continuing to limit broad-based borrowing.
Corporate credit growth showed more restraint over the period, with total corporate debt rising modestly to N$45.9 billion in 2025 from N$44.6 billion in 2024.
“Corporate credit growth slowed to 6.8% year-on-year in December, from 7.2% in November, driven by weaker demand and net repayments, particularly in the financial, fishing, and wholesale and retail trade sectors,” Jansen said.
Instalment sale and leasing for corporates grew by 18.5% year-on-year, slightly down from 18.9% previously, as firms continued to invest in vehicles, machinery and production equipment.
Other loans and advances increased to N$239.2 billion from N$203.2 billion, while corporate mortgage lending declined to N$160.8 billion from N$164.7 billion. Overdraft exposure rose to N$120.9 billion from N$97.8 billion, reflecting greater reliance on short-term liquidity earlier in the year.
“Corporate borrowing remains firm but selective. Firms are prioritising balance sheet consolidation and operational investment over speculative expansion,” Jansen said.
Overall, household credit growth edged up modestly to 2.7% year-on-year in December 2025, from 2.5% in November, with total household debt now exceeding N$883 billion.
Simonis Storm said the 2025 credit environment reflects a growing divergence, with households carrying a rising debt burden concentrated in essential and asset-backed segments, while corporates adopt more measured borrowing strategies amid stabilising economic conditions.
