The Nigerian economy is largely controlled by the government involvement and regulations which, in turn, determines the success of businesses. Because of this, the Nigerian government, as a result of the very important role played by Small and Medium Enterprises (SMEs) in the growth of the economy, put in place several loan schemes to help them grow bigger. In this article, we shall look at the Federal Government loan agencies in Nigeria that provide loans and grants to businesses in need of funds to expand.
Federal Government loan agencies in Nigeria
The federal government loan agencies in Nigeria include the following:
1. Central bank of Nigeria (CBN)
The central bank of Nigeria sits atop federal government loan agencies in Nigeria. The CBN, through a number of institutions, provide loans for different businesses in different sectors of the economy. Some products and services formerly or presently run by the CBN include:
- Anchor Borrower’s Programme (ABP).
- Commercial Agriculture Credit Scheme (CACS).
- Creative Industry Financing Initiative.
- Credit Support Scheme For The Healthcare Sector.
- Maize Aggregation Scheme (MAS).
2. Bank of Agriculture (BOA)
Going by their respective names, it is not difficult to understand their areas of service. The bank of agriculture is essentially a government sponsored bank whose job is to provide credit along with other funding to agriculture related businesses, especially to farmers.
- Agro-Processing Facility
- Direct Credit Product
- Equipment Leasing Product (ELP)
3. Development Bank of Nigeria (DBN)
This is another government run bank, regarded as a comprehensive financial institution. In addition, this bank has a goal to expand and provide access to loans for MSMEs in the country. In addition, some services offered by the bank are:
- Partial credit risk guarantees
- Capacity building (entrepreneurship training program)
- Wholesale lending
- Nigerian Export-import Bank (NEXIM)
The government specifically established this bank to provide financial assistance for export related businesses.
Besides, it ensures that businesses exporting goods and services from Nigeria have access to loans for proper functioning. Also, some of the NEXIM services include:
- Direct Lending Facility
- Foreign Input Facility
- Local Input Facility
- Nigerian Creative Arts and Entertainment Industry Loans
- Small and Medium Enterprise Export Facility (SMEEF)
4. Bank of Industry (BOI)
This is like the differing side of the coin to the Bank of Agriculture. The bank of Industry focuses on providing long-term loans to the industrial sector of the economy.
Also, it focus on sectors including information communication technology, solid industry, oil and gas, creative, agriculture, and agro-processing industry. Examples of the services offered by the Bank of Industry include:
- ASM Fund
- Bottom of Pyramid
- Fashion and Beauty Product
- Light Manufacturing
- Food and Agro Commodity Processing
- Graduate Entrepreneurship Fund
- Youth Entrepreneurship Support (YES) Program
5. Small and Medium Enterprises Development Agency of Nigeria (SMEDAN)
For small or medium sized business owners, the name SMEDAN would certainly be familiar. In reality, they are responsible for monitoring and coordinating the growth of MSMEs in Nigeria. Importantly, they help small businesses get access to loans and other funding. Their services include the following:
- Automotive (Component Parts Fabrication) Empowerment Scheme
- Commercialization, Empowerment Initiative (for ICT).
- Conditional Grant Scheme (CGS)
- Enterprise Network Initiatives
How do I apply for a loan in these federal government loan agencies in Nigeria?
Different federal government loan schemes in Nigeria have different application procedures. So, it is important that you start by researching the particular loan you need.
Also, loans agencies have different qualifications and application method that you must know. And a good way to start is by visiting their official website, which mostly contains the necessary information that you need. Check out list of federal government free-interest loans (See how to apply).