Traditional Lenders: How to Get Bank Loans in Nigeria

How to get bank loans in Nigeria is sometimes challenging. However there are many traditional, non-traditional ways to obtain loans. We have four major platforms to collect them. Loan providers are money lenders, traditional commercial banks, online loans and micro-finance banks.

Traditional Banks in Nigeria

The first place entrepreneurs seek loans are commercial banks. They provide the facility for private individuals, registered companies, cooperatives and government institutions. However loans are difficult to obtain and require serious documentation to access them.

Banks in Nigeria
Banks in Nigeria

What are the Functions of a Commercial Bank?

The functions are accept deposits, transfer funds, credit creation. Others include agency functions, provision of loans and other statutory functions. Anyone can open a current account, domiciliary accounts, fixed account or savings account.

Savings account owners enjoy small interests and are payable on demand. Current account owners are charge interest for keeping such facility.

Agency functions are purchase of sales security, payment of interest, providing drafts, cheques collection. They also provide short term or long term loans, overdrafts, discounting bills, demand loan and cash credit.


Functions of Commercial Banks

Accept deposits

  • current account
  • domiciliary accounts
  • fixed account
  • savings account

Transfer funds

Agency functions

  • purchase of sales security
  • payment of interest
  • providing drafts
  • cheques collection

Bank Loans

  • short-term
  • long-term loans
  • overdrafts
  • discounting bills
  • demand loan
  • cash credit

List of Commercial Banks in Nigeria 2019

Part of the core facilities of commercial banks is to provide loans for their customers. Here are a list of financial institutions in Nigeria.

1 Access Bank Plc 
2 Citibank Nigeria Limited 
3 Diamond Bank Plc 
4 Ecobank Nigeria Plc 
5 Fidelity Bank Plc 
7 First City Monument Bank Plc 
8 Guaranty Trust Bank Plc 
9 Heritage Banking Company Ltd. 
10 Key Stone Bank 
11 Polaris Bank 
12 Providus Bank 
13 Stanbic IBTC Bank Ltd. 
14 Standard Chartered Bank Nigeria Ltd. 
15 Sterling Bank Plc 
16 SunTrust Bank Nigeria Limited 
17 Union Bank of Nigeria Plc 
18 United Bank For Africa Plc 
19 Unity Bank Plc 
20 Wema Bank Plc 
21 Zenith Bank Plc 

Types of Bank Loans

Two types of credit are open or closed credit. A good example of open credit are credit cards while closed credit have specific time periods with monthly payment schedules.

Types to consider are student loans, mortgage, payday loans and small business loans. Others are home equity, cash advance, personal, automobile loans, retirement insurance, debit consolidation loans.

  1. student loans- cover cost of higher education
  2. mortgage- purchase homes
  3. payday – hedge gap between payday
  4. small business- startup or expand
  5. home equity- for projects
  6. cash advance- short loan credit
  7. personal- personal expenses
  8. automobile loans-purchase vehicles
  9. retirement insurance-retirement fund borrowing
  10. debit consolidation-pay outstanding debits

Secured Term Bank Loans

Secured loans are used for capital projects asset replacement, acquiring new technology and more. The loans offer competitive interest rate, funds for capital projects, convenient repayment aid cash flow.

How to Obtain Secured Loan

Maximum amount of loans offered by commercial banks is N40 million. They cover a tenor not exceeding 36 months, 50% of last six months turnover. Collateral include fixed deposit accounts, treasury bill or property mortgage.


The company is required to open a corporate account with the bank. Documentation are company profile, latest audited account, current utility bills. Others are fill an application letter, profoma invoice, 6 months bank statement, completed retail loan application form.

  • open a corporate account
  • company profile
  • latest audited account
  • current utility bills
  • fill an application letter
  • profoma invoice
  • 6 months bank statement
  • completed retail loan application form

Contract Finance

This facility is open to SMEs annual turnover up to N3billion naira. Contract finance offers funds for contract execution from approved listed companies. The company should be a primary contractor of the approved principle.

Tenor is 6 months with option of 3 months renewal. Estimated cost of loan amount 70% with customer evidence of equity participation at 30%.


Documents are awarded contract papers, bill of quantity, evidence of previous contract successfully executed. Evidence of government agency contract approval.

  1. Awarded contract papers
  2. Bill of quantity
  3. Evidence of previous contract successfully executed
  4. Evidence of government agency contract approval

Secured Overdrafts

Benefits for SMEs are support for expansion, growth, working capital. Good for cash flow management with convenient payment plan and competitive rates.

Amount obtainable for secured overdrafts is N20 million, maximum tenor 12 months. Collateral needed are either treasury bills, fix term deposit, legal mortgage.


The company has to open a corporate account in the bank. Accompanying documentation are company profile, 6 months bank statement, current utility bills. Others are proforma invoice from approved vendor, completed application, last audited account.

Personal Bank Loans

Personal loans are structured to address your personal needs. They cover a wide range of offers from salary advance to school fees advance. Others are quick credit, computer advance travel advance, mortgage, vehicle insurance premium financing.

School Fees Advance

Designed to finance payment of student’s school fees. This facility is for staff members of private or public organization.

The salaries of the parents seeking student advance for their child needs to have a salary account domiciled in the bank. The advantage is immediate access to funds, competitive interest rate up to N5 million fees advance.

How to apply for student loan

Complete employer undertaking, application form, obtain corporate guarantee. Provide staff benefit domicile in bank, credit insurance and school fees bill.

  • Complete employer undertaking
  • application form
  • obtain corporate guarantee
  • provide staff benefit domicile in bank
  • credit insurance
  • school fees bill
bank of industry
bank of industry

Bank of Industry

Bank of industry limited is a financial institution incorporated in 1964. The industrial development bank was restructured in 2001 with a share capital of N250 billion naira. It provides long term financing for Nigerians industrial sector.

Mandated to modernize, aid expansion, diversification of small medium or large establishments.  Envelopment orientation of the bank includes project selection, job creation impact and poverty alleviation.

They have offices in each geographical zones including the federal capital territory Abuja.

How to Farm Truffles

Bank of Industry Partners

BOI partners are federal ministry of finance, central bank of Nigeria. Others are Dangote foundation, federal ministry of industry and investment

Target Market and Product Offering

BOIs target are micro enterprises, large enterprises, small and medium enterprises. Product offering is for youth, women in business, asset finance and working capital.

Youths Programs are youth ignite, youth entrepreneurship support (Yes), and graduate entrepreneurship fund.


  • Youth programme
  • women in business
  • asset finance
  • working capital

Target Businesses

Target industries are Agro-processing, creative industry, information technology, solid minerals, oil and gas.

Complete list of Target Businesses

1. Aquaculture
2. Adire-Tie and Dye
3. Animal Feeds 
4. Blocks
5. Bakery 
6. Ceramics and Tiles 
7. Bottled Water 
8. Cosmetics 
9. Chemicals and Paints 
10. Digital Printing 
11. Dairy
12. ICT 
13. Window frames
14.Fish Smoking and Drying
15. Fashion 
16.Metal Fabrication 
17. Food Processing 
18. Furniture 
19. Fruit Juice 
20. Greenhouses 
21. Gemstones
22. Dry Cleaning
24. Mechatronics
25. Meat Processing 
26. Leather Footwear 
27. Health Care (Medical Diagnostics) 
28. Movies Production
29. Laboratories 
30. Plastics 
31. Quick Service Restaurants 
32. Quarries 
33. Recycling 
34. Solar (of grid) 
35. Soaps and Detergents 
36. Roofing Sheets
37. Water Transportation Riverine
38. Grocery packaging Theme Parks 
39. Theme Parks
40. Light Manufacturing
41. Technical or Vocational School

Bank of Industry Loan Criteria

There are things to know before applying for a loan. They do not finance groups of persons or individuals only duly registered companies or enterprises.

Startup businesses are considered at the discretion of the bank. Finance is offered to purchase of industrial equipment, provide working capital. They do not finance building or land acquisition.

Mode of Disbursement

Mode of disbursement of funds is to suppliers or vendors, cash is not given to the borrower. Loans start at N5 million while smaller sums are disbursed through microfinance bank partners.

Egg Distribution Business


Provide business name, registration number for Limited Liability Company. Collateral requirements are bank guarantee, debenture on assets of the company. Others are legal mortgage on landed property with (C of O). For loans bellow N10 million provide notarized statement from external guarantee.

  1. Business name
  2. registration number for Limited Liability Company
  3. bank guarantee
  4. debenture on assets of the company
  5. legal mortgage on landed property with (C of O)
  6. notarized statement from external guarantee

Bank of Agriculture

Bank of agriculture is a government sectioned financial institution for the agricultural sector. Loans provided by them are on-lending, micro, non-agricultural micro loans. Others are collaborative funding, small, medium enterprise loans, group, and cooperative loans. It is accessible to artisans, traders, livestock producers, fisheries.

Truffle Farming


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