How to Access Small Business Loans in Nigeria.


One of the biggest obstacles to young entrepreneurs in Nigeria is raising startup financing, especially from banks. Developed countries like USA, have well structured financing options for small businesses, with single digit interest and long term financing.

Unfortunately in Nigeria, the opposite is the case. Almost all bank loans have double digit interest and most are short term. This severely constricts the growth of small businesses, and consequently the economy of the nation. This is because small businesses are the backbone of strong economies. In developed countries, small businesses account for a large percentage of the GDP and provides the bulk of employment opportunities.

In recognition of this fact, the federal government through the CBN and other institutions like the Bank Of Industry and the Bank of Agriculture, continues to bring out financial packages tailored to meet the requirements of small businesses. The CBN has also directed banks to create packages meant solely for SMEs and fund such packages.

The benefits of  these packages include lower interest rates, even single digit interest rate in the case of Bank of industry , value-added business training or follow-up, little or no collateral etc.

It is most unfortunate that most of these funds meant for SMEs are lying dormant in banks and majority of small businesses are still unable to access them.

In this article, I will identify financial institutions in Nigeria that genuinely have funds set out for entrepreneurs and small businesses, I will also list the top reasons why most entrepreneurs are unable to access these funds, and finally, I will show you how to be able to access these funds.


Almost all the banks claim to have one package or the other for small businesses and entrepreneurs, but the truth is that most of these packages are nothing but a marketing campaign. They simply want you to open account with them.  But this shouldn’t deter you, because there are still few banks that genuinely have packages set out for small businesses. However, remember that every bank is in the business of making money, so they will not just give away money without due diligence. Let us start by identifying these genuine institutions.

Bank of Industry:

bank-of-industryBOI is an institution that genuinely  designs packages to help small businesses and entrepreneurs.  If you are sincere in your desire to obtain funds for your business, you will likely get help from BOI. The bank of industry keeps creating packages for entrepreneurs and youths, with the lowest interest rate of any financial institution in Nigeria. Currently, BOI has a soft loan for NYSC members, with no collateral (except their discharge certificate), another program termed YES-P is currently running for young entrepreneurs at an interest rate of 9% with no collateral ( Although the applicant has to provide 2 guarantors which has been a source of frustration for most applicants ). BOI remains the most sincere financial organization with a genuine interest in assisting young  entrepreneurs to access funds with no collateral.


Bank of Agriculture:


This is another financial institution in Nigeria that are assisting farmers and people in Agribusiness with soft loans. This is how Bank of Agriculture explains their function: “We are a federal government owned development bank with a mandate to provide low cost credit to small holder and commercial farmers, and small and medium rural enterprises. We also provide micro financing to small and medium scale non-agricultural enterprises. Our aim is to ensure effective delivery of agricultural and rural finance services on a sustainable basis to support the national economic development agenda, including food security, poverty reduction, employment generation, reduction in rural to urban migration, less dependency on imported food items, and increase in foreign exchange earnings. “

First Bank:


Many entrepreneurs has identified first bank as the commercial bank with the most friendly package for SME’s. As a commercial bank, first bank is in the business of making money, but they have truly lowered the threshold for accessing small business loans and have assisted many small businesses with soft loans. Quoting Mr. Oluwafemi Akinfolarin, First Bank’s Head of SME Banking “Getting loans without collateral is part of our contribution towards boosting the growth of the SME segment.” Most SMEs don’t have collateral to secure loans. The great thing about First Bank’s unsecured loans is that it is designed to be easily accessible to entrepreneurs irrespective of the type or size of your business.

Diamond Bank Plc


Diamond Bank Plc offers entrepreneurs an opportunity to obtain loans without securing the loan against collateral. The non-collateral loans are designed to stimulate growth for Micro Small and Medium Enterprises (MSME).

Diamond Bank has about 5 SME friendly accounts but if you want a loan without collaterals, you’ll most likely to looking at the bank’s SME loans. Diamond Bank’s SME loans can be accessed in the form of; Revolving Credit, Installment Loan, Local Purchase Order (LPO) Finance and Contract Finance.

According to Mr. Chima Nnadozie, Head, MSME Propositions, “presentation of a collateral security is no longer a bid deal for it to consider applications for, and grant loans to prospective and existing entrepreneurs in Nigeria’s micro, small and medium scale enterprises (MSME) sector.”

Stanbic IBTC Bank


Stanbic IBTC Bank offers Nigerian entrepreneurs a great opportunity to obtain business loans without providing collateral. The loans are designed to help SMEs buy assets, but the asset only become yours when you make the last payment on the loan.

To apply for a non-collateral loan with Stanbic IBTC, you should be prepared to provide the bank with the following information:

  1. The full names and capacities of those who will sign
  2. CV of each member of the management team.
  3. The reason why you need the finance.
  4. Your business’ financial statements, including an income statement, balance sheet and cash flow statements.
  5. Personal statements of assets and liabilities of all the partners, members or directors.
  6. A 12-month cash flow forecast.
  7. The amount of your own contribution and the source of the funds.
  8. If you do not have a business account with Stanbic IBTC Bank, you must provide the business’ bank statements for the past six months.





This is the no 1 reason why most entrepreneurs don’t access funds meant for them. They don’t even know where the funds are! Many young people today don’t listen to genuine news, they are fond of getting information from rumor and hear say. What everyone will tell you is that you can never get money for business in Nigeria. But some people are busy accessing soft loans and building their business. It is true that conditions may be stringent at first, but if you don’t try at all, you will get absolutely nothing! Following blogs, such as and other blogs designed for entrepreneurs, will expose you to options available to you.

Lack of preparation:

Many entrepreneurs who wish to access soft loans are totally unprepared to do so. You cannot simply expect to go to the bank, tell a wonderful story of how your idea is the best in the world, and expect to walk out with a bag of cash. It doesn’t work that way in the real world. Bankers attach zero importance to your beautiful story. They need concrete facts. How many entrepreneurs can write a convincing business plan?

business-plan-basicsMore than 90% of young businesses have never written a business plan, and this is the greatest barrier to accessing funds meant for them. Unfortunately most entrepreneurs will prefer to sit back and bemoan their fate, instead of learning essential business skills like writing a business plan. Little wonder that few entrepreneurs that attend business schools, do much better than their counterparts. Example founders, Tecno phone founder and slot chairman Nnamdi Ezeigbo. Young entrepreneurs should as a matter of urgency join business organizations like millionaires Academy, where they will be exposed to real world scenarios and taught essential business skills like how to write a business plan. (Follow this link to register now )

Lack of proper business training and organization:

For those already in business, it is a lot easier to obtain business loans, because your track record will easily convince any banker of the viability of your business. Unfortunately, many entrepreneurs, lack the basic financial skills required to properly organize their business and demonstrate its viability. Essential financial skills/tools that financial institutions are looking for in your business include:

  • Audited financial statementcash-flow-statement_screenshot
  • Current bank statement
  • Cash flow projections with break-even analysis
  • Business plan with CV of business owners
  • Understanding and building your credit score.

If you do not have such financial skills, you can either outsource it to accounting consultants, but better still learn it yourself, so you can confidently defend your business anywhere. Bankers are looking to make profit, and once your financials indicate that your business is profitable and scalable, they will jump at the chance to assist you, as they too needs to make money.


But before you ever seek any form of interest-based finance, you need to understand the cost of financing. This is another area that many entrepreneurs fail woefully. As a result, they are unable to repay loan facilities and this is the major reason banks are averse to supporting small businesses.

Are you lacking in any of these skills, then update your business skills with Millionaires Academy.

One of the greatest obstacles to our business growth is lack of proper training. Many people simply have a great idea or great ideas and carry themselves about as though the world must listen to them, without doing the hard work of learning how to effectively execute on their ideas. Others simply open an office and begin to hope for a miracle. Things don’t work that way. You have to do the needful, because opportunities come only to the prepared.


Join Millionaires Academy today and master the intricacies of building your business, raising funds and effectively executing on your ideas. The rise of technology will produce several million Millionaires in the next decade according to Credit Suisse. Will you be one of them? Or will you just be a spectator?

Join the next wave of wealth generators today. To register, Click here





  1. Hi Millionaire,
    While these skills are not easily obtain, but you are sincere with your training, you write your names on this generation.
    Many thanks

  2. It wonderful getting to know about this idea of seeking help where it can be found .Am eager and will to follow your lectures to better my future.

  3. Comment:for over 72hrs now i have being here looking at this loudable,famous plan for the young teaming population in our country.can this dream be actualised,considering the registration fee or its registration is it cost free?personally i like this a nigerian graduate on business administration&management i need to be sponsored in small scale busines.early over 5yrs ago i opened an account with B.o.A so as to enable me establish my busines out of my financial predicaments that account remains dormant.presntly i have account with diamond bank i have only nothing inside it because im a truthful nigerian im not crimnal.have my family.if this programme will be of aid to me better.but i havn’t come to the full knowledge of it.details or steps to follow before the grant or loan wil be offered to me.plz let me have it.

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