Introduction

Nigerian banks have been lending against land for so long that the habit has calcified into orthodoxy. Ask a credit committee whether a manufacturer with N2 billion in outstanding receivables qualifies for a working capital facility, and the first question is rarely about the receivables, but what title document the borrower possesses. In an evolving market such as Nigeria, this instinct is understandable and valid. Land does not walk away. But it is also increasingly indefensible as a universal credit principle, because the businesses that actually drive economic activity, such as the manufacturing, distribution, agro-processing, and logistics are not primarily land-holding entities. Their value sits in stock, invoices, equipment, and in the daily rhythm of a working capital cycle.