Although the Bank of Industry is a great place to access low-interest loans for your business, navigating their application requirements can be a bit challenging. But don’t worry; we’ve got your back!
We’ve put together a handy list of four fintech and government agencies that offer no-collateral loans. Plus, we’ll walk you through the requirements and application process for each loan provider.
If you haven’t read our article about how to get a loan from the Bank of Industry, you can find it here.
Now let’s start with our list of alternatives:
Oze is an award-winning business app for small businesses to manage their finances. Using Oze, business owners can track transactions, send invoices and receipts to customers, and sell online. Alongside all these things, Oze also allows small business owners to access no-collateral business loans that have affordable interest loans so a fantastic option for accessing a business loan as their loans have affordable interest rates and no hidden fees.
So, how does it work? You can apply for an Oze no-collateral loan in three steps:
Now, let’s weigh the pros and cons:
The Central Bank of Nigeria is in charge of controlling and implementing monetary policies in Nigeria.
One of its main goals is to provide an economic environment that makes it easy for businesses to access the funding they need to grow their business.
In line with this mission, the CBN has introduced several financing solutions, channelling them through its partner financial institutions (PFI), which include microfinance banks, commercial banks, development finance institutions, etc.
However, two of its standout SME loans are the Agri-Business/Small and Medium Enterprise Investment Scheme (AGSMEIS) and the Creative Industry Financing Initiative.
The Agri-Business/Small and Medium Enterprise Investment Scheme (AGSMEIS) was created to boost agriculture and SMEs in Nigeria.
With the AGSMEIS loan, you can:
Wondering if your business qualifies? It might if it is a:
The AGSMEIS loan is managed by Nirsal Microfinance Bank. To get started:
If your application is approved, you will be called for an interview by CBN.
The Creative Industry Financing Initiative (CIFI) is an incredible opportunity for creative entrepreneurs to secure long-term, low-interest loans for their projects.
These loans are specifically designed for individuals working in various creative fields like fashion, information technology (IT & student software development), movie production, and music production and distribution.
Here’s a quick breakdown of the loan details:
To qualify for the Creative Industry Financing Initiative, you and your business must:
As enticing as CBN’s non-collateral loans are for small businesses, you should consider these pros and cons.
The Small and Medium Enterprises Development Agency of Nigeria (SMEDAN) was established in 2003 through the SMEDAN Act to boost the growth of Nigeria’s MSME sector.
SMEDAN does not directly disburse loans, however, we added it to our list because of its credit information portal.
SMEDAN’s credit information portal is a great resource for businesses searching for affordable and accessible loans. With the portal, you can find the details you need about loans from different banks and government programs. It’s like a one-stop shop for everything related to loans.
To use the SMEDAN Credit Information Portal, simply:
You will receive a list of institutions that meet your criteria along with their loan details and the necessary documents you would need to apply for them.
Now that you know how SMEDANS credit information portal works, here are some factors you may need to consider.
The Tony Elumelu Foundation (TEF) Entrepreneurship Grant awards lucky businesses with training, mentorship, and a $5000 grant.
But what exactly is the Tony Elumelu Foundation (TEF) Entrepreneurship Grant?
The TEF Grant is a 10-year, $100 million initiative created by the Tony Elumelu Foundation to discover, train, and guide 10,000 entrepreneurs from across Africa.
Since kicking off in 2015, the TEF Entrepreneurship Grant has been a game-changer for 15,847 African startups, providing them with essential training, mentorship, and much-needed funding.
You can apply for the TEF Entrepreneurship Grant if:
However, you can’t apply if your business falls into these categories: research institutions, faith-based organizations, value-adding trading companies, and government contractors.
Meeting all the requirements is just the first step. The TEF Entrepreneurship Grant has five key stages:
1. Application phase
2. Training and mentorship phase
3. Business plan submission phase
4. Pitching phase
5. Seed capital phase
The first stage- the application phase- is entirely free and it kicks off every year on January 1st. To start your application, you need to:
The secret to a successful application is to make sure you describe your business plan or idea thoroughly. Cover all the bases – from the description of your business and market to your business financials and customer acquisition plans.
If you are accepted into the program, you will be asked to submit:
The $5,000 grant comes your way at the end of the training and business plan submission phase, which typically spans 12 weeks.
You’re practically guaranteed the funding if you’ve completed the training and mentorship and met the participation guidelines and objectives.
During the grant disbursement, you’ll need to provide a few more documents:
Before applying for The Tony Elumelu Foundation Entrepreneur Grant, you need to consider the following pros and cons:
You need to undergo training before you can access the grant funds. This means it may not be your best choice if your business is in urgent need of funds
Obtaining loans without needing collateral and at reasonable rates may seem like a tough task, but it’s possible with government initiatives like AGSMEIS, grants like the TEF Entrepreneurship Grant, and fintechs like Oze.
Oze is the business app you need for your business. Not only do you get access to affordable and transparent loans, you can apply for the loans with just your phone. Simply create an account with Oze to get started.