The Central Bank of Nigeria has proposed what it considers as the best way to source a loan as a small business owner in Nigeria. There are good ways you can get loans to fund your business when you are in need of cash. In this post, we’ll be looking at how to source for a loan as a small business owner in Nigeria.
Sourcing for a loan for Nigerians is usually a difficult task to undertake. This is especially for small business owners. It can be difficult to get loans. Here, we’ll be guiding you through the simple steps you can take to secure an easy and low interest loans.
How to Source for a Loan as a Small Business Owner in Nigeria according to Central Bank of Nigeria
To secure a loan as a small business owner, or what CBN considers as micro business owner, you don’t need the level of documentation and rigorous process a bigger business owner would be needing.
You simply need to go to smaller credit institutions to get your loans, and for these institutions, you don’t need much documents or rigors. Of course, the amount you’ll be needing is small–below 500,000 naira. Since the money needed isn’t large, you’ll easily get it without stress.
So, what kind of credit institutions can you get loan from in Nigeria as a small business owner?
1. Non-government organizations as low interest loans or even grants.
2. Co-operative societies where you have been a member.
3. Microfinance Banks that you have been doing business with.
4. Committee of friends or relatives.
5. Market unions or traders union where you have also been a member.
You can easily secure loan from all these bodies mentioned. This is why young or growing business people are encouraged to be members of different and varying groups.
To secure loan from them, you should be a member or their customer first.
Secondly, you must have been committed for over a year. You should not be owing debt, and your dues should be up-to-date.
You should be well-documented with them. They should know and verify your address. You should have a capable and verifiable guarantor. Your business location and mode of operation should be also verifiable.
The bank or any other group should check and verify your business’s balance sheet.
In addition, some of them will request for collateral equivalent or higher in amount to loan you are seeking.
There are also other criteria.
Nonetheless, once you have all these mentioned, you can apply for loan for these bodies mentioned.
How to Source for a loan as a small business owner in Nigeria shouldn’t be an issue after reading this. You’ll get it right and source the needed amount if you do it right.