Check out the Top 3 Small Business Loan and Grant in Nigeria for SMEs & Entrepreneurs
Getting a business loan is a major hurdle for most small business owners in Nigeria, mainly due to lack of proper credit facilities for small business owners and entrepreneurs in the country. But obtaining outside financing is often necessary to start or grow a business or cover day-to-day expenses, including payroll and inventory.
Although finding, applying for and getting approved for small-business loans can be difficult, the knowledge you have about it the easier it is.
On this article on on Top 3 small business loan and grant, it highlights the key ways, guide and steps you can take to secure a business loan or grant.
Individuals who wish to start their own business but do not have sufficient capital to developing your business can go to the bank or any financial institution to apply for a loan.
Banks and financial institutions provide financial assistance for businesses of all stages. Banks will lend even to a starter, if they are satisfied with the business model, projected returns from the business, the ability to pay back the loan (through business or otherwise), management experience and expertise and other security provided.
Though most bank loans come with a high-interest rate, it is important that you do your homework by comparing various business loan options available for small business by major banks in Nigeria. Before making your mind about which option to go for. Ensure you fully understand the terms of the loan agreement with an assurance that you can pay back within the stipulated duration.
Government-sponsored loans are always a preferred choice for smaller and growing businesses as they are more affordable.
Government business loans/grants can help SMEs manage their day-to-day operational expenses, growth and expansion costs and to ramp up their infrastructure. Several banks and financial institutions in Nigeria are working with the government to provide business loans under government-aided funding programs such as YouWin, BOI, N-Power, etc.
Most times, these government-sponsored funds come in form of a grant or loan with little or no interest rate. This makes getting one very difficult because you will have to compete with other business entrepreneurs.
FINTECH has opened its door to quick and easy short-term loans for small businesses and individuals in Nigeria. With major private organisations like Paylater (a subsidiary of OneFi), KiaKia, & Quick Loans taking the lead in providing short-term credit facilities. You can now apply for quick loans online and get paid within 24 hours.
This kind of loan is only provided for a very short period of time (at most 3 to 6 months) and is very limited in terms of how much funding that can be accessed but it could be your safest option in cases where you need quick cash to fulfill a client order or stock your inventory.
The key criteria for approval of any business loan are how profitable the business is and how the borrower will manage to repay. Depending on the lender, you’ll need to submit business documents such as a business plan, bank statements, tax return, legal document etc.
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