Nombank’s slow-lending strategy keeps bad loans below 1%
Quick Reads
- Nombank deliberately takes 24 to 48 hours to approve loans, rejecting the instant-lending race.
- The microfinance bank’s non-performing loan ratio sits below 1%, versus Nigeria’s 8.03% industry average.
- Account officers verify merchants physically before disbursing funds, blending automation with human judgement.
- Nombank lends exclusively to Nomba payment users with at least three months of transaction history.
- The bank plans a national licence but must grow its capital base 2,400% to qualify.
Nombank’s slow-lending strategy runs against everything Nigeria’s $2.1 billion digital lending market rewards. Rival fintechs promise approvals within minutes, betting that speed wins customers. Nombank, the microfinance banking arm of fintech Nomba, instead takes 24 to 48 hours before disbursing a single loan. That patience produced a non-performing loan ratio below 1%, far below the banking industry’s 8.03% average.
Seun Osunkeye, Nombank’s managing director, described the reasoning plainly. In an interview with Techcabal, he said the bank wants to give loans that will truly come back, adding that it prioritises businesses and merchants growing sustainably. Nombank previously tested near-instant lending but abandoned it after concluding that transaction data alone could not measure repayment risk reliably. Account officers confirm merchants are still operating and sometimes visit businesses before approving loans.
Payment data still does the initial heavy lifting. Nombank lends only to merchants already using Nomba’s payment infrastructure, and applicants typically need at least three months of processing history before they qualify. The bank studies daily, weekly, and monthly transaction patterns to judge how stable a merchant’s cash flow really is. Those patterns then determine loan size, generally capped near 20% of monthly inflows, with facilities running as one-week, two-week, or one-month working capital loans.
Nomba’s broader footprint makes this model possible. The company, which describes itself as a business banking and payments platform trusted by more than 600,000 Nigerian businesses, has watched daily payment volume grow sharply over the past year, giving Nombank richer transaction histories to underwrite against.
Nombank’s loan book remains modest next to bigger rivals. FairMoney disbursed over ₦150 billion in 2025, and Moniepoint moved past ₦1 trillion in the same period, dwarfing Nombank’s roughly ₦500 million so far this year. Still, the bank is pursuing a national microfinance licence, a move that would require its capital base to jump 2,400%. Scaling nationally, however, threatens the very discipline that kept its defaults low, since account officers cannot physically visit every merchant once distances stretch across the country. Osunkeye says technology, not just headcount, will have to fill that gap.
