Owning a car in Nigeria through financing schemes remains out of reach for millions of Nigerians, as rising vehicle prices, high interest rates, and weak purchasing power continue to limit access to car ownership. The combination of steep import duties, expensive loans, and weak credit capacity has made car financing viable only for a small segment of the population.
Industry experts say that while structured vehicle financing models exist, Nigeria’s income realities leave such schemes accessible mainly to high-income earners.
Adedeji Olowe, founder of Lendsqr, told BusinessDay that auto financing is technically possible in Nigeria, but income limitations and loan affordability prevent it from becoming a mass‑market solution.
Cars are physical assets; the way they could structure it today is realistically possible, but it’s not going to be widespread,” Olowe said.
Etop Ikpe, CEO of Autochek Africa, explained that structures gaining traction in markets like Nigeria rely on payroll-linked financing and layered capital. These models eliminate collection risk and deliver better pricing for borrowers. He emphasized that commercial banks play an essential role in this ecosystem. Ikpe highlighted that progress happens when multiple instruments work together—commercial bank facilities, OEM-subsidized rates, DFI participation, and government-backed schemes—layered to compress the borrower’s actual cost.
He said that the most effective financing structures for the self-employed are those that recognize a vehicle can be both a personal and productive asset. When a borrower’s income depends on mobility, even partially, the repayment logic changes. Lenders who design products to reflect that reality build stronger portfolios,” he said.
Oloruntoba Anate, CEO & The co‑founder of Automat Hub Ltd. told BusinessDay that high interest rates make traditional bank loans unfeasible. He stressed that asset‑backed private pools remain the only viable model today. Oloruntoba Anate, CEO & co-founder of Automat Hub Ltd., said that given the high interest rates, traditional bank loans are unfeasible, noting that the only viable model today is asset-backed private pools.
Anate noted that the auto financing scheme is feasible for low-income earners, but only as a productive asset (the vehicle must generate its own repayment), not for personal use.
However, Ikpe argued that under Nigeria’s current income realities, traditional vehicle loan structures remain largely out of reach for low-income earners. According to him, at the country’s minimum wage level, the numbers simply do not add up for a standard auto loan product, noting that anyone suggesting otherwise hasn’t run the math.
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