How to apply for a business loan in Nigeria

Jan 14th, 2021

Businesses thrive on the availability of funding, which essentially provides the muscle to wrestle competitors and meet customer demands. However, these funds are not always available, as not every entrepreneur starts a business with bottomless pockets. As a result, knowing how to apply for a business loan in Nigeria is one of the most important parts of being a business personnel. In this regard, this article explores the procedures and eligibility requirements to successfully applying for a business loan in Nigeria. See some top business ideas in Nigeria you can start exploring.


How to apply for a business loan in Nigeria

Before applying for a business loan, it is necessary that you put together all the documents that you would need. The complete process on how to apply for a business loan in Nigeria simply includes:

Step 1 – Confirm your credit eligibility: 

many financial institutions determine who they would and wouldn’t offer loan based on creditworthiness. Therefore, your company’s credit worthiness goes a long way in determining the success of your loan application. Furthermore, you can access this value through the CRC Credit Bureau. It is called the Credit Information Report (CIR). Essentially, your CIR comprises your credit transaction history and tracks all your previous and current loans. Also, it shows your loan repayment pattern and a poor pattern usually means they would turn your loan request down.

Step 2 – Compile all relevant business documents:  

no financial institution offers loans without documentations. Rather, what varies is the documents they request. You can do yourself and business a lot of good by compiling all the possibly needed documents before proceeding to apply for the loan. In addition, the documents usually include the following:  

  • Personal and business tax statement for 1 – 2 years.
  • Bank account statement for the past year
  • Proof of ownership or title documents for any asset owned.
  • Business plan (especially if you are looking for funding for your business idea)
  • CAC business registration documents, shareholders’ agreement document
  • List of staff members on the payroll in the last year
  • Document showing income statement in the last 2 years

Step 3 – Research adequate loan companies: 

The next step after determining your creditworthiness and gathering necessary documents is to research loan companies. Several loans institutions have different eligibility requirements and conditions that surround their loans. Therefore, the trick is in you discovering the best that suits your needs. Also, consult with professionals and experts in your field to get guidance. Don’t go in blind, rather, select the best type of loan for your need.

Step 4 – Proceed to application: 

The application process totally depends on the financial institution. Therefore, proceed to get the loan application form and fill it. Also, it is important that you read the loan agreement form carefully before signing. This agreement contains late payment penalties, breakdown on monthly payments, and hidden charges of the loan. In essence, you should do this to know when to seek legal counsel if unclear about clauses in the form. On submission, the institution then proceeds to carry out a credit check with the bureau.

Step 5 – Provide extra documentation: 

Adding extra documentation to your application always makes it look more credible. Essentially, it involves you writing something like a personal statement or business plan and submitting along with the loan application. Also, you can include other documents like your business model, financial statement and overall plan. This would increase your chances of securing the loan.


Loan application and disbursement procedures could take time, therefore, it may be wise to apply for a loan at a sufficient time before you actually need it. Also, there are numerous financial institutions that offer loans suitable for different needs. The federal government has ensured Nigerians has access to loans via the development bank. In the end, it’s all about finding the most favourable for your company.

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