Microfinance banks were established by the central bank of Nigeria with over N200 billion to improve the accessibility of loans to individuals and businesses, especially small and medium-sized businesses.
In the past, the small and medium-sized businesses suffered in the areas of finance and the establishment of these banks has helped them to reduce to the minimum. A lot of SMEs can now easily access funds to finance their business and focus their energy on another important aspect of their business.
How To Get Loan from Microfinance Banks in Nigeria
The importance of microfinance banks cannot be overemphasized in our country. It has improved major sectors like agriculture, local businesses, and many more. Below is the necessary step to follow to get loans from microfinance banks in Nigeria.
- Have a business plan
A business plan is not only essential in applying for loans, it also portrays the borrower as a serious individual who is capable of repaying back. So before applying for loans at microfinance banks, make sure you have a business plan to support your idea.
Most microfinance banks only grant loans to businesses with a good business plan that is capable of yielding high returns and strengthening the economy of the nations. So plan well before approaching microfinance banks.
- Proof of your business entity
Proof of your business entity can help you increase your chances of securing a loan. This is because a profof of business entity will show that you’re dedicated to a business and channel the loan on the right thing(your business), which will help in creating better opportunities for others.
- A bank account with the microfinance bank
After going through the application process, you will be required to open an account with the microfinance bank you want to take a loan from. This step is very important in capturing your biometric data and showing a sign of commitment to the bank.
- Waiting time
Some microfinance banks will require you to maintain a period of time before you can be eligible for a loan. After opening a new bank account, you will be required to keep your account active for about 6-12 months before you can be eligible for loans. Do not fret, this practice isn’t common.
Since loans come in two forms, secured and unsecured loans depending on the type of loans you want. For high valued loans, you will be required to present collateral that will be valuable like real estate property, car, or land.
Acquiring a loan from microfinance banks requires deep thought and thorough research. You might be confused to see how some of these banks operate, mostly unprofessionally. So shop around to pick the best that you will be able to meet up with their requirement with an easy application process.
In addition, ensure you’re familiar with bank terms like interest rates and many others.