Namibia’s private sector credit rose to an estimated N$122.9 billion in September 2025, with households holding 57%, corporates 42%, and foreigners less than 0.2%.
Simonis Storm Economist Almandro Jansen said the continued rise in credit uptake shows the resilience of the financial sector despite cost pressures, weak incomes, and a subdued property market.
This comes as private sector credit growth edged higher to 5.9% year-on-year in September, the strongest pace since March 2020.
Jansen said the growth reflects a sustained recovery across both corporate and household segments as the monetary easing cycle continues to support the real economy.
“This brings the average credit extension in the third quarter of 2025 to 5.8% year-on-year, much higher than the 2.3% average in the same quarter last year. The gradual upturn suggests improving confidence among businesses and households,” Jansen said.
Household credit growth rose to 3.4% year-on-year, up from 2.8% in August, with total household debt at N$70.1 billion.
Jansen noted that growth remains limited by weak wage increases, elevated living costs, and affordability constraints that restrict broad-based borrowing.
“Mortgage credit showed marginal improvement, rising by -0.30% year-on-year, compared to just 0.1% the previous month. Household mortgages expanded by 0.6% year-on-year, while corporate mortgage lending remained in contraction,” Jansen said.
High-income earners continue to dominate the mortgage market as low- and middle-income groups face high property prices and strict bank lending standards.
Instalment and leasing credit rose sharply by 15.9% year-on-year, driven by strong new vehicle sales and better availability of imported models.
“The commercial vehicles increased by 36% year-on-year, the highest since early 2024. In contrast, overdraft lending for households contracted for the ninth consecutive month (-10.3%),” Jansen said.
Rising food, transport, and utility costs continue to erode disposable incomes, forcing households to borrow cautiously. Other loans and advances grew by 9.3% year-on-year, mainly for education, healthcare, and short-term needs.
“Overall, household borrowing remains concentrated in asset-linked segments, particularly vehicle and equipment financing. Without stronger wage growth or relief from cost pressures, the pace of recovery will stay modest,” Jansen said.
Corporate credit growth eased slightly to 9.5% year-on-year in September but remains among the strongest in five years.
“The stock of outstanding corporate debt is estimated at just above N$51.4 billion, reflecting sustained investment appetite across key productive sectors despite a more selective lending environment,” said Jansen.
Growth was led by instalment and leasing credit, which rose 22.4%, supported by investment in machinery and transport assets.
“Borrowing patterns show a preference for credit that supports productivity and capital formation rather than liquidity hoarding. With the repo rate steady at 6.50%, corporate credit uptake is likely to remain resilient through 2025,” Jansen said.
He added that with the repo rate steady at 6.50% and commercial banks expected to pass on lower lending rates, corporate credit uptake is likely to remain resilient through the remainder of 2025.
“Growth will likely remain concentrated in agriculture, mining, manufacturing, and logistics, where investment demand continues to rise. However, downside risks persist from weaker global commodity prices and elevated project financing costs,” he noted.
