For many aspiring Nigerian entrepreneurs, business loans in Nigeria may be the only way to finally launch the business they’ve been dreaming about for years, but it’s not the only kind of loan available today. Find out how to apply for a loan in Nigeria depending on the type of loan you need!
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1. Quick loans
Quick loans are among the newest types of loans in Nigeria, but they are getting more and more popular. Quick loans are also often called payday loans because they are typically paid out on the day you receive a payment at your job.
There are dozens of companies in Nigeria providing quick loans to customers. Although you shouldn’t expect to get a large amount of money through these services, they are a good option if you need money urgently and are confident you can repay it on time.
Most Nigerian quick loan companies with a strong reputation have online services, where you can apply for a loan, monitor your finances, and repay the loan without leaving your house. These companies include KwikCash, Paylater, Branch, and Specta. Some of them, like Paylater, even have a dedicated app for your financial needs.
2. Business loans
If you’re wondering: “How can I get business loan in Nigeria without collateral?“, then you’ve probably already investigated the field and learned that Nigerian banks are not very likely to give you a big loan without collateral as a way to secure your loan.
However, taking a business loan without collateral is not impossible, but only as long as you take some steps to ensure a smooth issuing of the loan. Here are the conditions that will maximize your chances of getting that loan:
- You have a long relationship with the bank you’re planning to borrow from; preferably that includes the bank being the primary tool for your business transactions.
- You clearly now the purpose of taking the loan: it can be presented as a business plan or in your own words, but the bank needs to see that you’re not just taking money on a whim.
- You are specific about the amount of money you need and how you plan to repay the loan. Convince the bank that it won’t take you too long to pay the money back.
- Ensure the support of a guarantor. Since the bank isn’t asking for collateral, a guarantor is their most reliable way to make sure you eventually pay out the loan.
3. Agricultural loans
Agricultural business is on the rise right now in Nigeria and is the largest employment sector in West Africa. Don’t want to let this business opportunity go to waste? Here is how to apply for agricultural loan in Nigeria.
First you need to choose what kind of farming you’re going to do. The five agricultural businesses most likely to succeed today are palm tree, cassava, rice, poultry, and pig farming, although you can get a loan for pretty much any field of agriculture.
Bank of Agriculture is the most popular bank in Nigeria for farming loans. It is targeted specifically at aspiring farmers, which is why the conditions of taking a loan with them are not particularly severe:
- 6+ month relationship with the bank
- 2% interest rate
- Lien deposit – 20%
The BOA is rather flexible when it comes to the terms and conditions of their loans, so if you’re determined to get the best deal for an agricultural loan, start your search with the Bank of Agriculture.
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