Competition for Nigerian banking customers is intensifying as lenders deploy more resources to strengthen their brands, deepen retail penetration and defend market share while the industry adjusts to the Central Bank of Nigeria’s recapitalisation programme.
First-quarter financial disclosures from several lenders show significant increases in advertising and marketing-related expenditure at some institutions, indicating the growing importance of customer acquisition in an industry simultaneously raising capital, investing in technology and competing for deposits.
United Bank for Africa emerged as one of the most aggressive spenders during the period, with marketing-related expenditure rising to about N15.68 billion in the first quarter of 2026 from N5.65 billion a year earlier.
The movement represents an increase of roughly N10 billion within a year, suggesting a substantial acceleration in the resources committed to maintaining visibility and attracting customers across the bank’s markets.
Zenith Bank also increased expenditure in the category with spending rising to approximately N6.15 billion from N4.77 billion in the comparable period of 2025.
Smaller institutions are participating in the push as well.
Jaiz Bank’s expenditure increased from about N30.72 million to N529.49 million, while Sterling Financial Holdings recorded an increase from approximately N433 million to N1.20 billion.
The sharp percentage changes at some lenders partly reflect their relatively low starting positions, but the broader movement highlights the increasingly competitive environment confronting Nigerian financial institutions.
Banks are seeking to expand customer relationships at a time when deposits have become particularly valuable.
A larger and more diversified deposit franchise provides lenders with funding that can support credit creation, investment and transaction income. Low-cost retail deposits can also become increasingly important as banks seek to protect margins and generate stronger returns on the additional capital being introduced into their businesses.
The competitive pressure coincides with one of the most significant restructuring exercises in Nigerian banking in years.
Under the CBN’s recapitalisation framework, internationally authorised commercial banks are required to maintain at least N500 billion in paid-up capital, while national commercial banks require N200 billion and regional lenders N50 billion.
Banks have consequently turned to rights issues, public offers, private placements and other capital-raising strategies to satisfy the requirements.
But raising additional equity creates another challenge for management teams: putting the enlarged capital base to productive use.
Lenders capable of attracting more customers, deposits and transaction volumes will potentially have greater opportunities to deploy their strengthened balance sheets into lending and other revenue-generating activities.
That dynamic is increasing the strategic value of retail banking.
Nigeria’s large population and growing adoption of digital financial services have made individual customers and small businesses increasingly important to banks seeking diversified revenue streams beyond traditional corporate lending.
Technology has also reduced the need for customer competition to revolve exclusively around physical branch networks.
Mobile applications, instant payments, digital onboarding, cards and other electronic channels allow banks to acquire and serve millions of customers without expanding branches at the same pace.
Zenith Bank, for example, has previously identified retail customer growth through technology as an important component of its strategy, with the lender seeking to increase customer acquisition through digital channels and expand transaction volumes across its platforms.
The marketing push, however, is not uniform across the industry.
Some major financial institutions reduced expenditure in the first quarter, indicating that Nigerian banks are adopting different approaches to customer acquisition and brand investment as the recapitalisation process progresses.
The divergence also means higher advertising expenditure alone cannot determine which institutions are gaining market share.
Ultimately, the effectiveness of the spending will depend on whether banks can translate greater visibility into measurable growth in active customers, deposits, digital transactions and fee-generating activities.
For investors, those indicators could become increasingly important as the recapitalisation cycle moves beyond fundraising.
The first phase of the industry’s transformation has largely centred on how banks will secure additional capital. The next competitive question is how effectively they can deploy it.
As stronger balance sheets emerge across the sector, the battle for Nigerian banking customers—and the deposits and transactions they bring—is likely to become an increasingly important part of that contest.
