Business Loans

Loans come in different forms to meet different needs. Some are easy to pay back and can be done in a few months, while some hover around for years because of their sizeable amount. Long-term loans are those types of loans that require a long-term payback period. This is because we mostly use them for financing huge products and investments. There are several institutions that offer long-term loans in Nigeria and are all covered in this article.

 

What are long term loans in Nigeria?

Many companies undergo frequent capital projects that require a huge sum of upfront capital. This project ranges from machinery purchase to setting up arrangements with individuals that intend to purchase a property. Since these individuals mostly hope to pay back over time (from salaries), the company needs to turn to long term loans from banks to foot the project. This is a vivid picture of the continuous loop of long terms loans in Nigeria.

The loan is repaid in installments depending on the agreement, in accordance with business or personal cash flow. It could be monthly, quarterly, half-yearly, or even annually. Generally, long term loans in Nigeria can span anywhere from one or two years and above. Examples of these loans include equipment lease finance, operational vehicle, project finance, commercial mortgage, personal loan, asset finance, etc.

The structure adopted by most banks in offering long terms loans is that they fund a certain percentage of the total sum, while you are left to fund the rest. It is mostly in a 70/30 proportion.

 

How to get long term loans in Nigeria 

Getting long term loans in Nigeria is not as difficult as it sounds. Especially if you meet the eligibility requirements. Most commercial banks offer long-term loans and development banks like the bank of industry and bank of Africa. There are also different government initiatives for offering loans to businesses by CBN, through commercial banks too. Simply visit any physical branch or the official website of these financial institutions to get started.

However, there are general documents that most banks require of you to give out a long-term loan. They are: 

1. Application letter 
2. All duly completed retail loan application forms (it varies from one bank to another)
3. Proforma invoice approved by vendors supplying goods for your business
4. Company profile 
5. Current utility bill 
6. Last audited account 
7. Previous six months bank statement 
8. Cash flow budget
9. Certificate of incorporation 
10. Proof of address
11. Other KYC requirements necessary for opening a current account
12. Details of collateral where applicable (differs from one bank to another and depends on the amount of loan)
13. Third party guarantors (this could be requested instead of collaterals or along with it)

Note that different banks have different requirements. It could be more or less than what is listed above. However, the documents above are standard long-term loan requirements in Nigeria. 

What are the types of long term loans in Nigeria?

Long term loans in Nigeria generally fall under two categories. The categories are:

1. Individual long term loans: 

This loan caters to the needs of individuals. However, they are mostly available to high net-worth individuals. You can also divide them into the following;:  

• Personal loan: 

They offer this loan to individuals who might need it for personal reasons. They mostly give it to those with a capacity to pay back because they have a job or receive regular cash flow regularly.

• Home loans: 

They give home loans out to individuals who intend to obtain a property. The individual secures the loan with the bank, who funds a certain percentage of the value of the property you intend to purchase.

• Home equipment finance: 

This loan narrows the loan purpose down to furnishing a home. It offers you a loan to pay for the equipment expenses and takes it back from your salary based on the pre-agreed payment structure. The amount you are eligible for depends on your ability to repay.

• Auto loan: 

Auto loans are for those intending to purchase a car. How much you can access depends on your ability to repay. This makes it mostly offered to those with a salary or business with good cash flow.

2. Business and corporate long-term loans: 

Business and corporate loans cater to the needs of businesses. We can further divide them into the following:

• Commercial mortgage
• Equipment lease finance
• Project finance
• Operational vehicle finance
• Asset/ office equipment finance
• Bill discounting

Where can I get long-term loans in Nigeria?

Getting long-term loans in Nigeria is a simple decision. Virtually all commercial banks offer long term loans in the country. What differs, however, is the maximum amount of loan that they can offer. This mostly depends on your ability to repay, and sometimes the capacity of the bank in question. Simply walk into any commercial bank to inquire about the type of long term loan you are interested in.

As a business owner, can I get long term loans for my company?

Case Study

Getting a long term loan as a business owner for your company is all about meeting the eligibility requirement and possessing the right documents. To paint a better picture, let’s look at a case study of David as business man trying to expand his reach.

David has a truckload of experience in the processing industry, where he has worked for the last ten years. During this time, he rose from being a low factory worker to being the head of the division, therefore gather experience in the business and manufacturing aspects of the industry. He observed the trend of food hitting their lowest prices at certain times of the year, especially in their harvest period, and roaring outrageously high during scarcity.

David discovered the outrageous prices of yam, especially in the southern part of Nigeria, where there are not so many farms. Although the prices seem fair, he has been to the north where they are produced and seen how much cheaper they are.  While locals trade yams, there wasn’t any really top manufacturer that supplies hygienic and high-quality yams and its finished products in the south. He quickly realized this was his jackpot and called his job a quit.

Putting in the effort

His plan was to start the business of supplying yam and its finished products to the south, and he raised capital to this end. He was able to raise capital from family and friends, and the business kicked off and blossomed more than he expected. The business earned about N100 million in the past year which was more than enough to repay the capital and keep things running.

With time, he noticed the shortage of yam flour especially during some seasons in the year. This was paramount in the southern and western parts of the country, and he decided to tap into that market. To do this, however, he would need to expend his production capacity by purchasing machinery to meet demand. A savvy business that he hi, he inquired from his business bank officer the most viable way to fund this ambitious project. Although he would normally opt for an overdraft (N50 million), his officer advised against it, due to the short term that usually accompanies the loan. It wouldn’t be wise to obtain a year loan to acquire machines that would exceed the duration of the overdraft before yielding profit and have a repayment period that exceeds the overdraft.

After careful consideration and discussions, his account officer advised him to opt for a long term loan. The preferred option from the recommendation was through a development institution like the Bank of Industry (BOI) or Bank of Africa (BOA). Although much documentation is required to get the loan, David was able to fit in due to his numerous years of experience working in a top food processing company.

Knowing how to create value with loans

With time David put together the necessary detailed documentation, including his company’s operating profit and established market share, and got a loan from BOA at a favourable rate of 7% per annum. In obtaining this loan, he was able to keep his business running after expansion, reinvesting the profits and paying off the long-term loan.

Imagining this scenario, David would not have been able to expand his business without a long term loan. This is because he would have taken an overdraft, which has a tenure of around 12 months. Although he would have gotten the machine in this time, his business would scramble to repay the overdraft within this short time frame. As a good entrepreneur, it’s a totally bad idea, and he would most likely not take the overdraft. Rather, he would forgo his dream of expansion and try to save towards it. 

Conclusion

Long term loans are beneficial both on an individual level, and a business scale. It affords you enough cash flow to keep running, and acquire important assets immediately. The maximum amount of a long term loan you have access to, depends on your repayment capacity. 

Uber driving is one of the most lucrative jobs you can opt for when a white-collar job isn’t forthcoming. Apart from that, as a car owner, you can use Uber driving to earn more money during your spare time. Nowadays, most people prefer to choose Uber instead of a taxi, especially when your packaging is top notch. 

Who is an Uber driver?

Uber is a technology platform that operates a ‘bridging system’ to connect drivers and their passengers. 

 Uber registers people who own car that meets their requirements as a driver. They enlist such a person in the Uber app, where potential passengers can require their services through their smartphones.

Therefore, an Uber driver is a person registered under Uber to provide transport services to his passengers.  

 Why do I need a car loan for Uber driving?

The first and most important requirement you need as an Uber driver is a car. Not just any car, but a car that meets Uber provided requirements. Some of these requirements may include a car that’s less than 10 years old, in excellent condition and with an efficient car engine.

Hence, where you do not own a car or your car doesn’t fit into these requirements, you need to buy a car. Buying a good car doesn’t come cheap, so the easiest way out, when you don’t have the money handy is to obtain a car loan.

How  can I apply for a Uber car loan?

There are several loaning platforms/categories you can opt for. You can choose any of these categories that suits your financial capacity and creditworthiness.

1. Traditional loans:  

Banks or credit unions usually give this loan. It involves going to these specific banks to directly request for a loan. They often require a satisfactory credit score for their loans. However, loaning processes here are often long.

Recently Uber Nigeria made a declaration, offering potential drivers a low interest used vehicle loan through its partnership with FirstBank Nigeria and other financiers. Hence, if you apply to FirstBank of Nigeria, you would receive a loan at 20% interest rate per annum over 24 months

2. Bad Credit Car Loans:

This category offers an auto loan that they specifically design for people with low credit score.

 This is because you might not qualify for other loan platforms, considering your credit worthiness. Their requirements are also very meagre, as compared to the normal ones.

However,  interest rates on these categories of loans are usually very high. Although, with an excellent repayment record, you can subsequently be placed on regular interest rates.

3. Secured Car Loans:

This is a collateral based loaning system. In other words, in return for a loan, you will have to use your car as a collateral. This category equally provide loan for individuals with a low credit score at low interest rates

Secured car loans however comes with the risk of losing your car when you omit repayments.

4. Personal Loan:

This category involves Lenders. Through personal loans, you can get enormous sums of money from potential lenders with desirable interest rates. 

More often than not, lenders require detailed personal information such as permanent residential address, social security number etc.

5. Online Loans:

As the name implies, this involves an internet based transaction between the borrower and the lender. These online lenders often provide you with a wide variety of desirable interest rates. 

Application for an online loan is quite easy and provides an immediate response system. However, customer services on these platforms are often difficult to access.

To get a loan from any of these categories, all you need to do is apply.

What are the minimum requirements for getting a car loan?

Generally, if you want to seek for a car loan, these are the requirements you need:

1. A  good credit score: Your credit score is your financial worth. This factor is a major determinant of whether you would qualify for a loan.

2. Personal details: This includes your general information such as Full name, address, email, etc

3.   Debt account: Lenders would consider your debts record in granting you a loan. You need a minimal debt record because several debts record can affect your credit score.

4. Repayment history: You must have a good repayment history. This will guarantee your potential lender that you would remain faithful to your repayment agreement.

Conclusion

Car loans gives you the hope of achieving your financial target as n Uber driver even when you don’t have the complete means. It gives you the chance to buy the car of your dreams and conveniently pay for it over a particular period. 

Have you been desiring to work as an Uber driver but have no car? Opt for a car loan today!

The ever-evolving nature of technology means that people now prefer quicker and less stressful ways to do traditional things. One excellent example of this is the loan application process.

Once upon a time, you would have to join a queue, submit many documents, as well as collateral to be even considered for a loan. Now, how to get a fast loan in Nigeria has become as easy as ever, because of the emergence of digital fintech companies.

Is it possible to get a fast loan in Nigeria?

Yes, it is. There are a ton of platforms that offer extremely fast loans with easy eligibility requirements. From microfinance banks to independent fintech companies, you can get your desired loan from many sources. Even traditional commercial banks are adapting to the faster way of offering loans. With the channel, you can receive a loan in minutes.

What are the requirements for obtaining a fast loan in Nigeria?

The eligibility requirements vary from one institution to another. However, they generally have the following in common:

1.  A functional bank account
2. Valid form of identity
3. An account with the financial institution offering the loan
4. Other requirements as requested by the organization

For many of these quick loans, you do not need collateral. This, however, depends on the sum in question. Loans that do not require collateral are usually not of high value.

Where can I get a fast loan in Nigeria?

There are a large number of companies that offer such loans. This ranges from fintech to commercial and microfinance banks. Some of the best loan platforms in Nigeria are:  

1. Renmoney
2. Xcredit
3. Carbon
4. Aella Credit
5. Branch
6. Fair money
7. C24 Loan
8. Fint Loan
9. QuickCheck
10. 9ja Cash loan app
11. Spectra
12. Fast Credit Nigeria Limited

Do I always need to download the company’s mobile app to get a loan?

No, not necessarily. Although there are many companies that require you to download and register on their application, some do not. There are essentially two ways through which you can apply for a fast loan. They are:

Mobile/ online application: 

This means requires you to download the company’s official application or visit their official website, to access the loan. On visiting either of those platforms, they require you to create an account, and supply all requested details.

Your credit history and bank account details would be properly assessed before they disburse the loan. Examples of companies that offer this are Xcredit and 9ja cash app loan.

USSD codes: 

USSD codes require little process. You can get a loan by simply dialing a designated USSD code on your mobile phone. All you require is a mobile network connection. On dialing the code, a menu pops up which you follow accordingly to complete the process. Some examples of companies that offer this are kiwi cash, GTBank, Glo cash loan, and Interswitch.

Conclusion

The ease and advantages of having access to a fast loan in Nigeria cannot be overestimated. It saves you from emergency financial distress, and stressful paperwork.

However, just as borrowing the loan is easy, it should not be difficult to pay back too. Failure to do so could attract dire consequences.

The major problem faced by small to medium-sized enterprises (SMEs) is money for expansion. Most lack the finance to take that gigantic leap and cross over from being an SME to a large corporation.

Some save enough to achieve this, while others have to rely on investment from external individuals in the form of buying shares. The easiest way out, however, is to tap into available SME loans and grow your business, then pay back over a period.

How easy can I access an SME loan?

Do a quick search on google on the keyword “SME loan”, and it would amaze you at how many commercial and microfinance banks offer this service. In Nigeria, there is really no shortage of where you can get an SME loan to expand your business. What varies are the requirements of different financial institutions before giving you a loan.

Why SME Loan?

Small and medium enterprises are an important aspect of the growth of any economy. In the proper sense of things, SMEs employ most of the poor to average population. This is more than half the labor force of any country. From relationship, financing SMEs for expansion would directly impact the economy of a country.

In a country like Nigeria, there has been a very poor performance and help system for SMEs. This has affected the country’s economic growth and development. Addressing this problem could fix a vital cog in the economy, and spur rapid growth.

Factors affecting SMEs in the country

We can group the major problems affecting SMEs in Nigeria into 4 major categories. According to the FSS 2020 SME Sector Report, 2007, they are:

1. Unfriendly business environment.
2. Poor funding.
3. Poor managerial skills.
4. Lack of access to modern technology.

Of all these financial problems occupy the most grounds and arguably have a say in all. Money can help a business get out of unfriendly business environments, or hire the most qualified managers for the job. You can also purchase the best of technology for your business.

Where can I get an SME loan?

You do not have to look very far because most microfinance and commercial banks today offer such loans. However, microfinance SME loans are easier to access than many commercial banks. Some even require no collateral or paperwork, and you receive the loan in a matter of hours.

Examples of some financial institutions that provides SME loan services are:

1. UBA.
2. LAPO Microfinance bank.
3. Union Bank of Nigeria.
4. First Bank of Nigeria.
5. The central bank of Nigeria.
6. Zenith Bank Plc.
7. Zedvance.
8. Wema Bank Plc.

Conclusion

As an SME owner, take advantage of the opportunities provided through SME loans. You can finally expand your business and start raking in more profits. 

Play your cards right, and you can repay the loan within a short period, and carry on with your business. 

Keep in mind that it is not only about obtaining the loan, but how well you use it to the benefit of your business. 

There are many problems associated with establishing a company, and most of them stem from one source, which is finances.

Not everyone or groups has the unlimited deep pockets to whip out entire infrastructures and purchase licenses required to get going. As a result, many have turned to leasing until things fall in place.

Leasing has become very popular in Nigeria because of the high financial demands of industrialization and other manufacturing concerns. The leasing approach to investment reduces the strain on initial funding, therefore providing you with more flexibility. This article brings to you everything you need to know about leasing.  

What is a lease?

Definition

Leasing is a means that helps you as an individual or corporate organizations acquire fixed assets that you might not have been able to purchase due to the financial requirements of such assets. The contractual form of leasing is called a lease, and it outlines the terms and conditions on which one party rents a property from another party.

The contract obligations guarantee the lessee (tenant) the property to use, and the lessor (property owner) payments at agreed intervals, for a specific duration (months or years).

How does a lease work?

In a lease, the lessee acquires an asset from the lessor, for use, without purchasing it. You make regular payments instead, throughout the duration in which you use the asset. It is like rent and return after a specific time agreement.

Benefits/ Advantages of taking a lease

1. Tax benefit:

There are tax benefits for both parties involved in a lease agreement. The lessor (owner of the asset) can report depreciation as part of expenses in his financial book, therefore get the tax benefit. On the other hand, the lessee can claim the lease rentals to be an expense and also similarly get tax benefits.

2. A lease is essentially an off-balance sheet item. It allows you to take control of an asset while avoiding ownership and the risks of ownership in the process.

3. Steady cash flow: 

Perhaps the most significant advantage of leasing. It spreads payment of the lease across several years, therefore saving you the burden of a one-time high amount payment. This helps your business maintain steady cash flow.

4. Offers quality assets: 

With a lease, your business can afford quality assets that you might not have been able to afford in a full purchase.

5. Better usage of capital: 

A lease eliminates the financial commitments that would have been required to purchase an asset. This allows you to use your business capital to fund other necessary needs.

6. Low capital expenditure:

A lease offers significantly reduced cost on capital requirements for starting up your business.

7. Flexibility:

For most leases, there is usually a clause to terminate the contract or outrightly purchase it. This offers you much flexibility as a business owner to save for purchase before the end of your lease or walk away.

Disadvantages and risks associated with taking a lease

1. Lease expenses: 

the payments made during a lease are treated as expenses instead of equity payments for an asset.

2. Low financial benefits: 

Although paying a lease for a property, you cannot benefit from any appreciation in value. Also, the contractual obligations of a lease remain on your business regardless of whether the assets serve its usefulness or not. In a situation where it is no longer useful, the lease agreement becomes a burden.

3. Lower returns for shareholders: 

A lease reduces the net income of business without adding any value. This, in turn, results in smaller or limited returns for equity shareholders.

4. Debt:

The regular payment obligations of a lease are considered as long term debt, although it might not appear on the businesses’ balance sheet.

5. A lease might cause investors to shy away from your business since it is considered as long time debts. Loans may become harder to access.
6. No ownership:

The asset goes back to the lessor after the agreed duration.

7. Maintain the asset during the lease period, hence extra costs.

Conclusion

Leasing is an excellent way to get started for businesses that cannot raise enough capital. If used wisely, you can navigate setting up your business till it can run on its feet, but a poor use could cause otherwise. 

Make sure you carefully consider and analyze the importance of taking a lease before committing.

Loans are debt incurred by an individual through a corporation. The individual will agree to the terms of payments, including any interest charges and fees before they disburse the loan. 

As scary as debt may sound, sometimes it is necessary primarily if we use it to accrue interest with dividends.

For example, in the purchase of a house, get a loan. After paying for the entire house, it becomes an asset which you can sell and make to regain that loan plus some added interest for yourself.

As simple as that analogy is, it can become complex when you get market economics involved and all that, but the point of the analogy is that when loans are taken and used smartly, they are very beneficial. 

In this article, we will discuss some loans that Diamond (now Access bank) offers and how you may take advantage of them.

Listed below are Access Bank’s Loan packages:

• Creative sector loan
• Lending against turnover
• Personal loan
• Salary Advance
• Small Ticket personal loan
• W-Power Loan
• Advance for School fees
• Device Finance
• Maternal Health Service Support
• Payday Loan
• Vehicle Finance

Creative Sector Loan

This loan was initiated by the Central Bank of Nigeria to aid entrepreneurs in the following sectors:

• Fashion
• Information Technology
• Movie Production and Distribution
• Music
• Software Engineering Student

How can you access this loan?

• Prepare a business plan for your business
• Walk into any Access Bank branch to apply or apply at www.accessbankplc.com
• A relationship bank officer will contact you on the next steps
• Maximum yearly interest, including fees, is 9%
• The repayment period is a maximum of 3 years of the Software Engineering student loans and ten years for all other investments.

Lending Against Turnover

This is a loan that is dispersed to non-salary account holders who have had a relationship with the bank for over six months. 

How does this work?

• The application is conveniently made on the phone registered with your Access bank account. Just dial *901*11# and follow the prompts
• No documentation or collateral required
• 30-day repayment plan

Personal Loan

This is a salary-administred product that serves as a credit life insurance. This gives an employee access to 75% of their annual salary with terminal benefits and 50% of their yearly wage without terminal benefit.

How can you access this loan?

• Submit an application form
• A complete Employer Confirmation form
• Provide evidence of the confirmation 
• Copy of employment ID and a valid means of identification
• All these documents can be submitted at any Access Bank or www.accessbankplc.com

Salary Advance

This loan gives you access to up to 200% of your net monthly salary to be paid back in six months. 

How does this work?

• You can apply on the phone registered with your Access bank account. Just dial *901*11# and follow the prompts
• No documentation or collateral required
• 6-month repayment plan

Small Ticket personal loan

This loan gives you access to up to 400% of your net monthly salary to be paid back in twelve months. 

How does this work?

• You can apply on the phone registered with your Access bank account. Just dial *901*11# and follow the prompts
• No documentation or collateral required
• 12-month repayment plan

W-Power Loan

This loan is available to women-led businesses (at least 50% women ownership) with an operating tenure of a year. 

Qualifications for this loan: 

• At least 50% of female ownership
• At least a year in operation
• A minimum of 2 staff
• At least one credible guarantor plus post-dated checks. 

Advance for School fees

This product is designed to help parents/guardians with school fees of their children at any level of education. It can also be used by individuals to finance undergraduate, graduate and professional courses.

How does it work?

• Download application form on www.accessbankplc.com
• Send the form and all required documents to schoolfeesadvance@accessbankplc.com
• If the loan is approved, offer letter is sent with the execution. 
• The loan is dispersed into the school’s account. 

Device Finance

This product is designed to help purchase a new mobile device. It comes with a maximum of 12 month tenure.

How does it work?

• Download the Quickbooks apps on your app store (available on ios and android) and follow the prompts
• Click on the device console and make your selection.
• Accept the Terms and Conditions
• A transaction code will be sent to your email as well as instructions to pick up the device. 

Maternal Health Service Support

This product was designed to ease the financial burden on families during the birthing process of a child. In addition to labour, the following procedures are also covered under this loan: Hysterectomy, Myomectomy, Dental, Orthopedic, Bariatric (weight loss procedures)

Features of this loan are:

• No loan fees
• Highly subsidized interest rates
• Flexible repayment plans
• Access to over 30 fertility clinics and birth travel companies in Nigeria

Payday Loan

This is an instant loan product for salary and non-salary earners alike.

How does this work?

• The application is conveniently made on the phone registered with your Access bank account. Just dial *901*11# and follow the prompts
• No documentation or collateral required
• 31 days repayment plan

Vehicle Finance

This product was designed to aid in the purchase of vehicles. 

Features of this loan are:

• Open to salary earners, SME’s and corporations
• Equity contribution as low as 10% of the invoice value
• Up to 48 months tenure 
• Variety of vendors to choose from

Conclusion

Access Bank is a thought leader with the different products it offers. Key features are some conveniences it provides with some products such as USSD code applications. If you want more information about these loans, please visit www.acessbankplc.com or contact an agent here. 

Quite a number of people deal with the requisite involved in securing a loan in Nigeria. In most cases, regular banks do not reply nor accept loan applications while others have placed standards uneasy to reach. 

Microfinance banks dwell to ease financial demands. They as financial institutions provide easy services where individuals will meet up in comfort. Where there are other microfinance banks that offer great services, a number of them that ensure safe customer services and one of them is Fina Trust Microfinance Bank. 

About Fina Trust Microfinance Bank. 

Fina Trust Microfinance Bank stands tall amongst a number of well delivering micro finance banks and they provide services suitable for their customers. 

What products does Fina Microfinance Bank offer?

Fina Microfinance Bank offers a number of services to cater to various needs. They include: 

 Micro Loans

This service is suitable for SMEs, entrepreneurs, students as well as traders to access close to 1 million naira for already existing businesses. Fina Trust Microfinance Bank charges a minimum interest rate of 5% where the total summation is dependent on customer response. 

Salary Advance

This product is targeted at salary earners thst enables them to access close to 75% of their monthly salary in advance.  

Group loan

Very common in subjective parts of the world, Fina Microfinance Bank as well offers group loan which is available at a 3.5% interest rate. The Group loan product is presented in a credit rotation model.

This model is where a group of people become informal financial institutions through repeated contributions and withdrawals from several parties. This is due to limited service provided by formal authorities and restrictions of some sort.

The group loan seemingly reduces the risk to the lender which allows them charge lower interest rates than other loan types.

Here, the transaction is made through people themselves and it is also based on individual needs or lottery. This helps individuals who find it hard to get access to substantial capital by letting them have periodic access to needed funds where they have to pay within a period of time. 

Advantages of Fina Trust Microfinance Bank

• The Fina Microfinance Bank offer products thst are conveniently for customers. As an example, they have convenient repayment plan as well as equal monthly Principal and interest repayments.  
• Their conditions are flexible.
• This MFB make sure that it is possible for retail business to obtain funds for capital projects with installmental repayments. 

Disadvantages of Fina Trust Microfinance Bank 

• This Microfinance Bank in for loan requests demand the availability of a guarantor. 
• The maximum time allotted to products is six months. 

Requirements of Fina Microfinance Bank

The major requirements include;

• For group loan, group members must reside in the same location.  
• There must be group gurantor for group loan. 
• Potential customers must provide two credible gurantors. 

How to contact Fina Microfinance Bank

You can visit the head office at 46, Toyin Street, Ikeja, Lagos State, Nigeria. Or reach through +234-01-6326874/ +234-01-6326875 or +234-9062020040.  Furthermore, you can send a mail to inquiry@finatrustmfbank.com. 

Conclusion

It is safe to say that when the need arises to gain access to loan facilities, you should contact Fina Microfinance Bank for their suitable services. 

The arts and crafts make up an integral part of any community. They are what depicts the soul and the identity of any group of people. Recognising the importance of creatives is a crucial thing to do. 

However, being a member of the creative community can be tough because so many opportunities are not open to this sector. This applies most, especially in loans.

Getting a loan as a creative for your business is very difficult, considering most banks will only finance a loan with a prime chance of repayment, and creative loans do not rank highly. This could be depressing, but not to worry— there’s hope on the horizon. If you’re creative, and you’re looking for a loan, this post provides information on how to solve your money issues with loans from the Central Bank Of Nigeria. 

About CBN loans for Creatives

Recognising the need to cater financially for the creative industry, both the Central Bank and the Bankers’ Committee set up and implemented plans to facilitate this idea. 

This idea comes in the form of the Creative Industry Financing Initiative. CIFI is set up to help in the process of job creation by encouraging entrepreneurship in the creative industry with the loans. 

Who is eligible for the Creative Industry Financing Initiative?

The initiative covers four focal points in the creative industry. These focal points are Fashion, Movie/Film, Music and Information Technology. These categories mainly include the aspects of movie production and movie distribution, software engineering, fashion designing and music student loans. Anyone in these fields is automatically eligible to apply. 

How much is available for loans? 

The Creative Industry Financing Initiative realises how intensive the creative industry is, and that to make value, the loans need to be substantial. That is why businesses applying for loans in the CIFI are eligible for loans up to the amount of N500 million. 

How does the CIFI work? 

One primary requirement of the loan is to be a member of the creative industry, especially in the categories listed above. As there are different categories, so also does the amount eligible for each vary. The categorisation goes as follows; 

• Software Engineering students can get up to N3 million
• Movie Production businesses can get up to N30 million
• Businesses into Movie distribution are eligible for up to N500 million
• Fashion and Information Technology businesses can get loans to cover their rentals and other service fees
• Music businesses can get loans to cover the fees for training, equipment and rentals, and service fees.

How to apply for CIFI loans

• Prepare your business plan. This should state how much we need and what the business entails. The business must operate in the creative industry.
• After preparing the plan, head off to any Bank of your choice and apply for the loan.
• Your application will be analysed and reviewed and determine if your business is eligible. If it is, the loan is successful, and you get the funds requested for.

Does the loan charge interest?

The CIFI loans attract a maximum of 9 percent interest rate per annum. 

What are the repayment schedules for the CIFI? 

The various categories have unique payment schedules. They are as follows;

• Software Engineering Student Loans are to repaid under three years maximum.
• Movie Production and Distribution loans have a maximum of 10 years.
• The Fashion, Information Technology and Music based loans have a ten-year maximum repayment plan.

CONCLUSION

If you’re a creative looking for loans in Nigeria to finance your studies or business, then applying for the Creative Industry Financing Initiative is your best bet to getting that financial help.

Sometimes, emergencies arrive and individuals feel the need to take loans, to pay back as agreed. It could be weekly, monthly, or even once-in-three-months. It depends on the period that both parties agree upon. When these emergencies arrive, an employee will need to ask his or her employer for a financial upfront.

What is Salary Advance Loan? 

A salary advance is a loan usually given to an employee. As the name implies, it is usually a part of the wages of an employee paid at the end of the month. Naturally, only an individual with a salary job is eligible for this loan. 

This loan is usually short term, and it comes also with interest rates, though subsidized. Also, there are terms associated with repayment. You can make once at the end of every month, or once every three months. It is important to understand that employers rarely give salary advance except otherwise stated.

Banks are in charge of this. However, if an employer gives a salary advance to one employee, he must extend the opportunity to other employees. Discrimination based on performance, race, age, or gender is highly discouraged. 

What should you know before you take a salary advance loan?

Salary Advance policy educates you about the information you need to equip yourself with before you can take a loan in Nigeria. These include: 

1. Are you eligible for a loan?: Most times, the eligibility criteria are for individuals who earn a stipulated amount each month. This means that only individuals with a salary job are eligible for this loan.

2. What percentage of your salary do you need: A salary advance loan cannot give you a complete salary as a loan, except you apply for a particular percentage of your salary. It is important to know exactly what you need before you apply for the loan.

3. How much will I be paying in return?: It is always important to check this out because some interest rates can be outrageous. Always select a loan option with a favourable rate.

How to get a Salary Advance loan

Typically, most Nigerian banks such as First Bank and Access Bank give loans of up to N500,000, although this amount depends on your salary and your past financial records.

To get a loan, all you have to do is contact your bank for more information on the process involved. After this, they will notify you about the loan periods and repayment plans. For instance, Zedvance loan periods count after a day (the day on which you get the loan). 

Where can I get one?

We can get salary advance loans from different financial institutions across all tiers. It could be a commercial bank, like the Zenith Bank loan, community bank, or microfinance banks

Conclusion

A salary advance loan is perfect for you because they have designed it to handle emergencies. Also, there is usually no waiting period before the collection of the loan. As soon as an application is made, and they check the eligibility status of the client, the loan is made available almost immediately.

Before the recommendation of microfinance institutions in Nigeria, many businesses under small and medium ventures have been represented poorly in the financial sector. They are denied easy access to funds which has affected their business and means of livelihood.

In a bid to address the funding requirements of the SMEs, the Central Bank of Nigeria set up a microfinance development fund with a seed capital of N220 Billion. The fund will be administered by the Central Bank of Nigeria and managed by licensed microfinance institutions.

What is Microfinance Lending Institutions

A Microfinance Bank (MFB) is an institution duly licensed by the CBN to perform the business of providing microfinance and other financial-related services. Microfinance services refer to loans, deposits, fund transfers and any other financial products targeted at low-income clients – just like the other microlending services in Nigeria.

Where Can I Get a Microfinance Loan in Nigeria?

There are over 1000 microfinance banks (MFBs) in Nigeria, which include unit MFBs, state MFBs and national MFBs. Collectively MFBs are much smaller than other banks, with a total lending portfolio of up to N53 billion. The Central Bank of Nigeria (CBN) requires all MFBs to lend at least 80% of their loan portfolio to micro-enterprises. 

How to get funding from microfinance banks 

They play vital roles in poverty eradication, agriculture, increase in small scale businesses, etc.  

We will concentrate on MFBs in Nigeria and how they grant loans. The following are steps to getting a loan in Nigeria from most microfinance banks:

1. Have A Genuine Plan or Project for the loan

Before approaching any MFB, make sure you have a plan and a business plan to support your idea. This increases your chance for a favourable response from the micro-lending institution. Bear in mind that these microfinance institutions were established for the sole purpose of strengthening the economy. Because of this, they only grant loans that fall in the category of SMEs

Most microfinance banks grant loans for business purposes, asset procurement, agriculture, educational purposes, loans for salary earners, etc. 

2. You might need proof

Showing the lenders proof of your business entity or plan can help you secure the funds you need from a microfinance bank. For example, if you are a trader, you might require proof of business ownership in the documentation of your business registration. You might also need bank statements or receipt of transactions showing that you have an operating business.

3. Open An Account With The Bank

After getting all the documentations right, the next thing is to open an account with the microfinance bank. When you apply for a loan in a microfinance bank, the first thing is to open an account with the bank. This is for data capturing as well as to show commitment to the bank.

4. Maintain The Account For some time

Some microfinance bank would require that you maintain an account with them for a period before you can be eligible for a loan. However, it is not common practice. It does not just end with opening an account with the bank, the account has to be active which involves paying and withdrawing money from the account constantly before you can be qualified to apply for a loan.

5. Get collateral to secure the loan

You may also need to present collateral when applying for a secured loan in a microfinance bank. However, it may not be applicable to small business loans for petty traders and individuals. Some microfinance banks do not need collateral. But, it will be necessary for business loans such as assets acquisition, agriculture and other loan application with a more substantial amount.

Conclusion

You need to be careful when opting for a microfinance bank. Some of these banks are not qualified financial service providers and often treat customers unprofessionally. Which makes one wonder if SMEs really need microfinance banks.

Be sure you understand the terms and condition as well as compare interest rates from other microfinance banks to get the best deals.