How To Apply For A Business Loan In Nigeria |
loan & finance

How to apply for a business loan in Nigeria

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Starting and running a successful business requires a significant amount of capital, and not everyone has the financial means to do so. This is where business loans come in handy. They provide entrepreneurs with the necessary funds to start, grow and expand their businesses. In Nigeria, there are various financial institutions that offer business loans to entrepreneurs. However, getting approved for a loan requires meeting certain eligibility requirements and following specific procedures.

Eligibility Requirements for a Business Loan in Nigeria

Before applying for a business loan in Nigeria, you need to ensure that you meet the eligibility requirements set by the lending institution. Generally, the following requirements are necessary:

1. A registered business: You must have a registered business with the Corporate Affairs Commission (CAC) in Nigeria.

2. Business plan: You need to have a comprehensive business plan that outlines your business goals, strategies, and financial projections.

3. Credit score: Your credit score is an essential factor in determining your loan application’s success. A good credit score shows that you are financially responsible and can pay back the loan.

4. Collateral: Depending on the lending institution, you may be required to provide collateral, such as property or equipment, to secure the loan.

5. Cash flow: Lenders want to see that your business generates enough cash flow to repay the loan. Therefore, you need to provide financial statements that show your business’s earning potential.

Procedures for Applying for a Business Loan in Nigeria

Once you have met the eligibility requirements, the next step is to apply for a business loan. Here are the steps involved:

1. Research the lending institutions: Research various financial institutions that offer business loans in Nigeria. Look for ones that offer loan products that align with your business needs and requirements.

2. Gather all necessary documents: Before you start the application process, ensure that you have all the necessary documents, including your business plan, financial statements, and collateral.

3. Complete the loan application: Most lending institutions have an online application process. Fill out the application form and attach all the necessary documents.

4. Wait for approval: The lending institution will review your application and determine your eligibility for the loan. This process can take a few days to several weeks, depending on the institution.

5. Receive the loan: If your loan application is successful, the lending institution will disburse the funds to your business account.


Applying for a business loan in Nigeria can be a daunting task, but it is necessary for entrepreneurs who want to grow and expand their businesses. By meeting the eligibility requirements and following the application procedures, you can increase your chances of getting approved for a loan. Remember to research various lending institutions and choose one that offers loan products that align with your business needs. With the right funding, your business can thrive and compete in the Nigerian market.

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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 of 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 loans based on creditworthiness. Therefore, your company’s creditworthiness 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 documentation. Rather, what varies is the documents they request. You can do yourself and your 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 statements 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 the necessary documents is to research loan companies. Several loan 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 out. Also, it is important that you read the loan agreement form carefully before signing. This agreement contains late payment penalties, a breakdown of 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 it 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, numerous financial institutions offer loans suitable for different needs. The federal government has ensured Nigerians have 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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