Top organizations and small-scale businesses often go through phases where capital or resources are required for the growth of their businesses. Therefore, they seek out business loans. The good part is that several banks give business loans in Nigeria.Â
Although, The size of your business and the purpose of the loan, essentially determine how much money the Bank will lend to your business. However, most top financial institutions in Nigeria can give loans suitable for both large corporate organizations and small businesses
Therefore, in this article, we will provide an extensive list of banks that give business loans in Nigeria and everything you need to know about them.
Table of Contents
Does The Bank Require Collateral For a Business Loan?
Yes, most banks do require collateral for a business loan. Although collateral may not be needed if you borrow smaller amounts of money, larger amounts commonly do require collateral
Acceptable forms of collateral include:
- Obligations of the Federal Government of Nigeria (FGN Bonds, FGN Eurobonds, FGN Treasury Bills, and others)
- Obligations of state governments or agencies of the Federal Government of Nigeria
- Other non-government debt instruments
- Physical assets e.g. real property
- Third-party guarantors (or collateral)
How Long Will It Take Before Receiving Funds From The Bank?
The length of any application process differs from bank to bank. Generally, the more money your business needs, the longer it will take for funds to be approved and disbursed. When applications are made through digital channels, funds are generally provided much quicker than when applications are made at a branch.
Top 11 Banks That Give Business Loans In Nigeria
Here is a list of banks that give business loans in Nigeria:
1. Guaranty Trust Bank (GTB)
GTB is among the top banks that give business loans in Nigeria. The bank offers personal loans for purposes of whether you have a small or large business. They also offer entrepreneurs opportunities to obtain loans without collateral.
GTB provides smart financing options for your business that allow your organization to grow. GTB offers different types of business loans including:
- Food industry credit
- Hub Advance
- Quick Credit for small business
- Overdraft
- Term loans for school
- SME invoice discounting Finance (SME IDF).
2. Access Bank
Access Bank is one of the prestigious banks in Nigeria that offers loans for business purposes and also SME-focused loan products. The bank is best known for its quick loan process, flexible repayment options, and competitive interest rate that helps your business grow.
Access Bank is the largest bank in Africa by customer base and the largest bank in Nigeria by assets; it has more than 42 million customers and has several products and services suitable for both small and medium-sized enterprises as well as large businesses.
Access Bank offers loans to businesses with or without collateral. However, the borrowing limit with collateral is usually lower than business loans with collateral. The business loans a typically for both small and medium businesses.
3. First Bank of Nigeria
First Bank is a renowned bank in Nigeria that provides business loans to both medium and small businesses. First Bank offers different varieties of credit facilities, including invoice discounting, term loans, and overdrafts.
The SME loans are available to assist small and medium businesses grow and expanding or even financing their operations. These business loans can be used to get inventory and equipment.
4. Zenith Bank
Zenith Bank is among the top Banks that give business loans in Nigeria. The bank offers flexible long and short-term loan products. Zenith Bank provides structured credit to meet lump sum funds or running costs for your plans.
Zenith Bank SME loans are available to provide access to funds for business expansion needs with competitive interest rates and flexible repayment plans.
5. Eco Bank
Eco Bank is one of the largest financial institutions in Africa, and it is one of the top Banks that give business loans in Nigeria. Eco Bank offers a variety of services and electronic tools for your business, from straightforward cash management to payment tools that keep your turnover secure.
The bank offers a wide range of credit facilities, including food industry credit, overdraft, invoice discounting, and term loans.
6. United Bank of Africa
UBA is one of the largest banks in Nigeria that offers a range of business loans and credit facilities. These business loans are suitable for both large cooperates and smaller companies. The UBA Short term business loan is good for small, micro, and medium-sized businesses.
7. Sterling Bank
Sterling Bank is among the top Banks that give business loans in Nigeria. The bank is renowned for its wide range of credit facilities, including trading finance, working capital loans, and asset finance.
Sterling Bank’s SME loans are an ideal option to build your business, with flexible repayment plans, competitive interest rates, and a quick application process.
8. Fidelity Bank
Fidelity Bank is one of the top banks in Nigeria and is known for its innovative approach to banking. Whether you are interested in starting a new business, expanding your cash flow, Fidelity Bank offers a range of flexible business financing services that help to build your business.
9. Stanbic IBTC Bank
Stanbic Bank is one of the largest prestigious financial institutions in Nigeria. It is among the top Banks that give business loans in Nigeria.
Stanbic Bank offers quick SME loans without collateral. Â The SME loan is provided for businesses to meet working capital needs and also achieve business goals. Stanbic business loans are only provided to companies that are registered with CAC.
10. Bank of Industry
Bank of Industry is a reputable financial institution that offers business loans in Nigeria. The bank empowers SME, micro, and large enterprises with single-digit interest loans and beneficial business support.
The Bank of Industry has a range of direct funding products. These products come in shapes of secures loans, working capital loans, asset financing, and more.
11. Union Bank of Nigeria
UBN is one of the top leading banks in Nigeria that offers variety of credit facilities. Union Bank offers a range of business loan products and other financial solutions. There are varieties of business loan options for both large-scale and small-scale businesses.
How much interest Does a bank charge on a business loan?
Interest rates charged on Bank loans vary. Some loans are provided at single-digit interest rates, while others are more expensive. In addition to paying interest, there are also other charges on Bank loans, such as management fees.
How Long Do I Have To Pay Back A Bank Loan?
Repayment periods differ. Banks can provide both short and long-term funds. Typically, unsecured lending (without collateral) comes with a shorter repayment period, when compared to secured lending.
Conclusion
Getting approved for a business Bank loan may have follow a longer process, depending on the bank. As a business owner, You can easily increase your chances of approval by taking some steps ahead of time. Simple steps like understanding the loan requirements and knowing your credit score could make a difference between an approval or a loan denial.
Also, it is advisable to do your own research on the bank before you apply to avoid getting stuck in a situation that does not actually fit your needs.
Reference
- Sukfin.com
- Wikipedia.org
- Accessbankplc.com
- Nairaland.com
