One of the major financial institutions that offers loan in Nigeria is the Central Bank of Nigeria (CBN). With the CBN loans and proper strategy, you can take your business to the next level.
The Central Bank of Nigeria (CBN) was established in 1958 by the House of Representatives of Nigeria. From then till now, it remains the Central Bank and apex monetary body of the country. It is 100% owned by the government.
According to CBN’s official release, their functions include:
- To ensure monetary and price stability.
- Issue legal tender currency in Nigeria.
- Maintain external reserves and safeguard the international value of the legal tender currency.
- Promote a sound financial system in Nigeria.
- Act as a banker and provide economic and financial advice to the federal government.
Pros of CBN loans
- Accessible by everyone.
- It caters to the needs of businesses in different sectors of the economy.
- Less stringent eligibility criteria.
Cons of CBN loans
- Loan disbursement time is usually long due to the numerous protocols in place.
- Loan application involves a lot of documentation and processes.
Maximum and minimum amount of Central Bank Loans
Generally, there are loan options as small as N500,000, and as high as N500 million or more, but it is mostly depends on the type of loan in question.
What services does the Central Bank Loans offer?
The Central Bank of Nigeria currently offers the following loans:
1). AGSMEIS Loan for SMEs and Agricultural businesses without collateral: this loan is available for SMEs and agricultural business owners.
Features: You can access up to N10 million.
Interest rate of 9%.
Disbursed by NIRSAL Microfinance bank and other banks. => Apply for CBN AGSMEIS loan.
2). Accelerated Agricultural Development Scheme loan (AADS): the objective of this loan is to engage youths in agricultural production.
Features: You must be a Nigerian youth between the ages of 18 to 35.
You must sign an undertaking on the terms and agreements from CBN.
Up to N1.5 million loan is accessible.
Interest rate of 9%. => Apply for CBN AADS loan.
3). Micro, Small, and Medium Enterprises Development Fund MSMEDF Loan: this loan service is strictly for SMEs and micro-enterprises.
Features: Only available to SMEs and micro-enterprises.
Your business must be involved in one of the agriculture value chain, cottage. Industries, artisans, services, renewable energy, trade and commerce, and or the businesses allowed by the CBN. => Apply for CBN MSMEDF loan.
4). Anchor Borrowers Program Intervention for Agriculture (ABP): this loan is accessible to small farm owners engaged in producing specific commodities in the country.
You must belong to between 5 and 20 groups or cooperatives.
It is available to businesses that intend to become anchor or farm product suppliers. => Apply for CBN ABP loan.
5). Creative Industry Financing Initiative Loan (CIFI): the CIFI was established to increase job creation among young individuals in the creative and information technology (IT) industry.
Features: Your business must be in the creative and information technology (IT) industry.
Loan of up to N500 million. => Apply for CBN CIFI loan.
6). CBN Healthcare Research and Development Grants: CBN developed this loan for the healthcare sector and research and development. It is accessible to institutions, pharmaceuticals, research and development of drugs, vaccines, herbal medicines, etc.
Features: Your business must fall under one of the categories listed above.
Up to N500 million in loan.
Be informed that the loan services listed above have rich requirements and application processes. Visit the CBN official website at www.cbn.gov.ng to access the full information.
Are there any additional fees?
No. There are no additional fees to the CBN loan application and disbursement.
What are the minimum requirements for taking up a Central Bank Loans?
The necessities vary from one loan service to another. Go through the aforementioned loan services offered by CBN to get a glimpse of their respective requirements.
How quickly are funds released for a Central Bank Loans?
As a result of the many processes and protocols in involved, CBN loans are not often given quickly. It could take months, or up to a year to receive the loan after approval. Because of things, we cannot put a duration on how quickly loan funds are disbursed.
What are Central Bank Loans repayment terms?
The CBN’s only repayment terms are the pre-agreed interest rates. The interest rates are often between 5 to 10% or more, dependent on the specific loan in question. During the loan application, however, important details like the rates would be specified. After you exceed the stipulated time for payment, applied interest grows in successions.
Are there any Restrictions to Central Bank Loans?
The only restrictions to Central Bank Loans are the eligibility requirements. If you qualify and have all the documents, then you can apply. Asides that, there are no other restrictions.
The Central Bank loans are one of the ways through which the government of Nigeria aims to improve the economy. The loan offers services to SMEs and individuals across different sectors of the economy, especially those in certain lagging areas.
If qualified, apply to enjoy the full remunerations of the government for growing your business today.