This article holds everything you should know about long term business loans in Nigeria.
Irrespective of the gains declared by businesses year in and year out, they need to obtain loans to finance important projects upfront, remains a problem they will continue to solve as such businesses last. Check out How To Get A Huge Business Loan.
They will continue to travel this road I order to help their operational cost and cash flow, while acquiring valuable assets. For companies, long term business loans in Nigeria are not just a way out, it is also a way through which banks make their own profit.
Apply For: CBN Non-Interest Loan 2023
Benefits of long term business loans in Nigeria
The benefits of long term business loans in Nigeria include:
Longer repayment periods
The reimbursement plan for long business loans are always spread across long intervals, specifically in years. This gives the business enough occasion to strategize and earn enough profits to pay up the loan.
Higher funding amounts
Long business loans offer a far superior amount than short term loans, reason being that it is paid back over a longer duration, and attracts gorgeous interest rates that benefit the banks.
Lower interest rates
The interest rate of long term business loans is lesser on the side of the borrower, even though it still favours the bank. Short term loans, on the other hand, usually come with exorbitant interest rates.
Lower monthly payments
Because of the privilege of having repay the loan over a long time, long term loans offer lesser monthly payment to businesses that they can easily meet. It is nonetheless mostly designed in a way that the longer the delay in payment, the more the total amount you end up paying.
Different customization options
Companies that acquire long term loans typically have enough ease to modify the loan. Because the lender wants to see the business succeed in most cases, they offer the borrower more flexibility as regard repayment so the borrower can earn enough to repay.
Types of long term business loans in Nigeria
Below are types of long term business loans in Nigeria:
1. Commercial mortgage
Commercial mortgages are exclusively offered to companies who intend to procure a property for saleable purposes. The business then repays the loan over time, based on the agreement with the lending bank. The amount of loan depends on the bank’s policy and the company’s cash flow.
2. Equipment lease finance:
This type loan is geared towards purchasing machinery and other operational tools. It is acquired by companies intending to expand or increase their operations, and is reimbursed over a long period.
3. Project finance
Project finance loans are given to companies who intend to carry out a project. It comes with a moratorium to allow construction to proceed, so long as the repayment source is from the project that is being funded.
4. Operational vehicle finance:
Similar to auto loans offered to individuals, companies who intend to purchase vehicles for working use and official use of their staff can acquire this kind of loan. The repayment plan is also spread across a number of years.
5. Asset/office equipment finance
This loan funds businesses that intend to furnish their office. It can be likened to home equipment finance loan, but it is basically for business. The loan covers basic equipment like furniture, computers, and others, and the repayment is spread over time.
Long term business loans in Nigeria have long being known for saving business establishments and growth in the country. These loans make sure that businesses can run and grow at the same time, without forgoing their vision of expansion. If you are a business owner, taking long term business loans might just be your way to breakthrough.
Apply For: CBN Non-Interest Loan 2023