How to get loans for small businesses in Nigeria for startups: SME loans in Nigeria made easy

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Getting loans for any kind of business is being made easy right in this page. See more as you read through.

Having a good business idea can be so easy, but having the financial strength to bring these businesses to reality is always the challenge.  

As a result, the business vibes in many young and promising entrepreneurs have been tamed because of lack of funds to help finance their businesses to their dream level. Many have asked to know if there are SME loans in Nigeria, while others want to know the loan givers in Nigeria and also if there are free loans in Nigeria.

  The good news is that there are ways you can access loans in Nigeria and beyond, that will help bring those great business ideas to reality, and help those who are already into business to take their businesses to the dream heights. So, let's go! 

How to get loans for small business startups

Before you can secure loans for your business/business ideas, there are some factors you need to consider which shall be needed in the loan processes. So, while doing your self analysis to ascertain your qualification, these are the areas you should focus on that will help you get the loans :

Why do you need the loan

There is a good chance that this will be the first question you will be asked by your lender. Why?  He wants to get to know the reason he should invest in you. As we all know, we are in a society where people don't waste time to defraud another. So nobody will want to give his money to someone he is not sure will pay back the money. 

He will be expecting you to give responses such as: I need the money to start my own business, I need the money to expand my business, or to see to day-to-day demands, and many other genuine reasons that will be able to generate more money.

Go to the best type of small business lender

 There are many channels you can key into and get loans to finance your business. Some of these channels are the banks and other financial institutions, government loan schemes, online lenders, and nonprofit microlenders, etc.

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 Banks are known for their lowest Annual Percentage Rate (APR). Go to the bank if you have collateral, you don't need the money urgently, and when you have good credit. 
Small businesses finds it challenging to secure loans because of the lower sales volume, lack of collateral, and lack of cash reserves. It may take between 2 to 6 months to finally scale through owing to many paperworks, and verification processes, and you don't have to give up. 

Government loan schemes 

The government has partnered with some financial institutions to provide loans to small business startups across the country.

Government loans are more affordable and are meant to help new entrepreneurs build their business worlds. The loans can help small startups to finance their daily expenses while making some profits. The government recently have come up with the Npower loan scheme to help boost entrepreneurial ideas in agriculture and other sectors. 

Online Lenders

Just when you don't have hope of getting fundings from your friends or even banks, there is yet another option you have to consider so as to get loans for your business. That is online lenders. 

 Online lenders are best choice when you have no collateral and you need the money quickly. Their approval rate is faster and you are likely to get the requested fund within 24 to 72 hours. This loans don't last for very long time. Maybe 3 to 6 months and is limited depending on how much money is accessed. 

There are many private organizations who have done much to make it easy for business owners to access this online loans. Some of them are :Quickloans, Kiakia,  and Paylater which is a subsidiary of OneFi

 Another major factor that lenders consider is the credit score of the one in need of loan. Having a good credit score is always a great advantage as it will help you secure the loans even before others. 

 Also the viability of your business will help determine how fast you get the loans, because the lenders will consider if you will be able to pay back the money as promised. 
 
Some lenders will also request that you submit documents such ad Tax returns, business plan, bank statements, and legal documents, etc. 

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 Apply for the loan

After ensuring that everything has been kept in place, go ahead and apply for the loans from the lender of your choice. You can apply for loans from multiple lenders, then any one that comes out faster you go for it.

Good luck.