BUSINESSES in the country are borrowing more from commercial banks, with agriculture, construction and tourism-related enterprises leading demand for credit.
This signals increased investment and economic activity despite persistent global and domestic challenges.
According to the Central Bank of Eswatini (CBE) monthly statistical release for May/June 2026, credit extended to businesses rose by 3.2% month-on-month and 9.8% year-on-year to E13.2 billion in May. The report attributes the growth to stronger lending across key productive sectors of the economy.
The strongest growth came from agriculture and forestry, where lending increased by 12.9%, followed by construction at 11.4%, distribution and tourism at 6.9%, transport and communications at 0.4% and manufacturing at 0.2%. Lending to mining and quarrying, community and personal services and real estate declined during the period.
In simple terms, increased borrowing by businesses often means companies are investing in expansion, purchasing equipment, financing projects, buying stock or improving operations. Such investment can eventually translate into more business opportunities, employment creation and higher economic output if the borrowed funds are used productively.
The CBE report suggests that the agriculture and construction sectors were among the biggest drivers of economic activity during the review period. Increased lending to agriculture may reflect investment in farming operations, machinery and production, while stronger construction credit could point to ongoing infrastructure and property development projects.
The report also shows that large companies accounted for 68.5% of total business credit, with borrowing by these firms rising 7.3% during the month. Although lending to small and medium-sized enterprises (SMEs) declined by 4.7% compared to April, it remained 11.6% higher than a year earlier, indicating that smaller businesses continue to access more financing over the longer term despite short-term fluctuations.
The increase in business lending contributed to a broader rise in credit extended to the private sector. Overall private sector credit climbed to E23.9 billion, representing growth of 2.5% month-on-month and 10.6% year-on-year. The Central Bank said the improvement reflected increased lending to both businesses and households, while credit to other domestic sectors declined.
Households also continued borrowing, with credit rising 14.4% year-on-year to E9.8 billion. Growth was mainly driven by unsecured personal loans, followed by motor vehicle and housing finance. While household borrowing supports consumer spending, economists generally caution that rising personal debt should be balanced against borrowers’ ability to repay.
Despite stronger lending activity, the report showed that broad money supply (M2) edged down 0.7% during the month, although it remained 11.3% higher than the same period last year. This indicates that while banks were extending more loans, overall liquidity circulating in the economy eased slightly during May.
The banking sector nevertheless remained financially sound. Domestic liquid assets stood at E8.7 billion, while the banking industry’s liquidity ratio remained at 33%, suggesting banks continued to hold sufficient liquid assets to meet their short-term obligations even after a modest monthly decline.
Taken together, the latest figures paint a picture of an economy where productive sectors are increasingly seeking finance to support investment. Although some industries continue to face challenges, stronger borrowing by agriculture, construction and tourism-related businesses provides an encouraging signal that confidence in key sectors of the economy remains resilient.
