The money lending industry in Nigeria presently is, and will remain, one among the services in high demand. This is because the present economic condition in Nigeria indicates that many Nigerians are poor. As a result, many people seek to borrow money to survive. Nonetheless, the biggest reason for the high demand for lending services is down to the presence of many Small and Medium Enterprises (SMEs) in the country. A good number of these SMEs don’t have access to funding. Because of this, you can make good money by filling this service gap as a money lending service provider.
But before then, you need to know what it takes to start such a business and the steps you need to take to successfully register your kind of business in Nigeria. This is exactly what this article is about to teach you.
What is the amount required to start money lending business in Nigeria?
Based on the information available at the time of writing this article, the share capital of a money lending company must not be below N20 million naira. This is just for the approval of the business to start transactions. Before you can start making a profit, you may need to have sufficient capital to cover the cost of operating the business.
How to register a money lending business in Nigeria?
The registration of businesses in Nigeria mostly follows the same process as being obtainable with the Corporate Affairs Commission. But being that the world has been digitized, a larger chunk of the process can be done online. Visit the CAC website www.cac.gov.ng and fill the following on the form provided:
- Your company’s name reservation
- CAA1.1 Pre-registration form
- Proof of filing and stamp duty charges
- Upload the required documents for Directors and Secretaries
- Proficiency Certificate
- Proof of CAC payment
Note that you are also required to submit the original copies of those documents to the CAC office.
Now, what are the steps to follow to register a money lending business in Nigeria?
Apply to the Magistrate Court
Here, you will be mandated to submit the following:
- Your application letter
- Certificate of incorporation
- Office and tax clearance
- Company’s memorandum and articles of association
- Proof of maintenance of current bank account
- CAC form 2 & 7 certified copies
Upon successful submission, the court will give you a letter and form B of the money lending ordinance to proceed.
Apply to the Ministry of Home Affairs and Tourism with the following:
- N10,000 money lending certificate fee
- N50,000 Ministry invoice
- Magistrate Court’s form B and C
- Proof of application fees payment
- Certificate of incorporation
- Police report issue by the Commissioner of police
- PAYE certificate
- Income tax 3years clearance certificate
This step basically deals with visitation and examination of your business premises. Upon successful check, your money lending permit will be issued. However, it is important you have the following to assist your business:
- Operational manual for money lending
- Prepare all necessary forms and recording essentials
- Get a computer system
- Get a legal expert for assistance if needs be.
To be a good money lending business owner, you need to possess good management skills and strategic thinking. It is important you get these handy.