Namibia’s microlending sector recorded a 3.0% decline in its outstanding loan book to N$7.3 billion during the first quarter of 2026, even as the average term loan increased to N$25,620, the average payday loan rose to N$4,030 and total loan disbursements rebounded 2.4% to N$927.8 million.
According to the Namibia Financial Institutions Supervisory Authority (NAMFISA), the contraction in the industry’s aggregate loan book reflected continued weakness in term lending, despite signs of a recovery in new lending activity.
Term loans remained the dominant segment of the market, accounting for 91.0% of the total outstanding loan portfolio.
“The improvement was largely driven by a 28.7% rebound in term-lending disbursements following the resumption of lending by a major lender after the temporary suspension of loans to government employees linked to changes in the Payroll Deduction Management System (PDMS),” NAMFISA said in its First Quarter 2026 Statistical Report.
The regulator said lending activity remains below levels recorded before the Payroll Deduction Management System disruptions, indicating that the sector is still adjusting to the new operating environment.
Demand for short-term credit continued to drive the market. Payday lenders accounted for 72.0% of the total value of loan disbursements and 94.0% of all new loans issued during the quarter, while term lenders accounted for the remaining 6.0%.
The number of household borrowers declined by 1.7% during the quarter to 274,732, although borrower numbers were still 6.0% higher than a year earlier. Term borrowers represented 58% of total clients, compared with 42% for payday borrowers.
The report also highlighted the high concentration of Namibia’s microlending industry.
In the payday lending market, Express Credit Cash Advance (Pty) Ltd retained its dominant position with 68.5% of the outstanding payday loan book. Janeel Financial Services CC held 5.9%, while Pause Financial Services CC accounted for 3.2%, giving the three lenders a combined market share of 77.6%.
The term lending market showed a similar pattern. Letshego Micro Financial Services (Namibia) (Pty) Ltd held the largest market share at 28.8%, followed by Entrepo Finance (Pty) Ltd with 28.1% and Old Mutual Finance (Pty) Ltd with 22.3%.
Together, the three institutions controlled 79.2% of the outstanding term loan portfolio, reinforcing the sector’s concentration among a small number of large lenders.
