World Bank is an international financial institution, licensed to provide loans and grants to the governments of countries that have either low or middle income for the purpose of fighting poverty.
A lot of Nigerian citizens have benefited from the World Bank Grant, which comes through the Federal Government, especially in building small business enterprises in the country.
World Bank grant is designed to help Micro, Small and Medium Enterprises (MSMEs), and as such, it is tagged as a small business grant.
Before taking you down to full, it is better that we bring to your awareness about how many Nigerians have benefited from the world bank grant.
The World Bank is an international organization which is saddled with the responsibility of financing or providing funding for nations as a means of support in carrying out their projects. Some of these projects include eradicating poverty, controlling outbreaks, and rebuilding health centers where the government of such a country seems incapable of doing so or has limited capital to carry out its functions.
While we make progress, it is necessary to know that the world at large operates financially on two financial institutions, which are the International Bank for Reconstruction and Development (IBRD), which has an appropriate number of 187 countries as members, and the second institution, the International Development Association (IDA), with which 173 countries stand as members. And this group has been effective in building many African countries through the provision of loans.
One thing to know is, Nigeria, as a giant of Africa, has relied on the World Bank for the majority of its growth.
Aside from the profits generated by the oil sector, this assistance from world bank has been extended to other African countries.
- 1 Benefits of World Bank grant in Nigeria
- 2 World Bank grant for small businesses in Nigeria
- 3 Types of world bank grants in Nigeria
- 4 Advantage of the small business grant
- 5 Disadvantages of small business grants in Nigeria
- 6 How to Apply for World Bank grant in Nigeria
Benefits of World Bank grant in Nigeria
The grant has helped in eradicating poverty, and providing other related assistance to Nigerians which include:
- They have assisted in creating stable jobs for their youth and the less fortunate through grant loans, and most citizens have benefited from the bank through their government.
Rebuilding microeconomics and financial growth through policy sponsorship and performance-based lending.
They have also supported the growth of the Nigerian agricultural sector through the lending of money to grow the agricultural base and, as a result, tend to increase its productivity.
Promoting and creating more opportunities for the country outside of the non-oil sector and economic activities, referring to the non-oil and economic viability reform.
Supported the restoration of peace in most of the conflict zones of the country, basically in the north-east of Nigeria, victims especially to those areas that are affected the more.
They take on additional responsibilities, such as advocating for governmental and cultural commitments to gender equity.
Providing Nigerians with the best social services possible.
Those above are the major benefits the World Bank has granted to Nigerians, and as such, aims to do more for the growth of the country, most of which is not done for free, but rather through the lending of loans signed by the two institution groups.
Note: In the distribution of the loan, it is often done through the Microfinance bank, which is one of the financial institutions that seems closest in supply of financial grants.
World Bank grant for small businesses in Nigeria
Here, there is a lot to look into, which is broken into phases, starting with what is called a small business grant.
Explaining this is not far from using a loan to explain it, meaning its responsibility in Nigeria is to provide funding for most developed small business enterprises and, if possible, extend it to those who might feel inclined to start such business enterprises. This putting together is to take small business enterprises higher.
Meanwhile, aside from the world bank, most of these grants have been done by some recognized organizations and are still going on before the world bank emergency theirs. The body or organization that does this are governmental and non-governmental empowerment organizations in engaging their citizens based on their capability.
Types of world bank grants in Nigeria
Haven gained knowledge of what the grant is to Nigeria, and with the knowledge of the type of grant, will help you understand more about the grant. These grants are:
1. Direct funding/Award
Direct Award is one type of grant that comes with ease and is not for every small business enterprise. Instead, it is only given to an already established small business; that’s after you have played your part in funding some part of your business plan. In this case, the grant is given to you in order to lift your business higher. That is why it is called a “direct award expected not to be repaid.”
2. A reimbursable grant
As its name implies, this is not a direct award, which is mainly to be repaid. In this aspect, you are required to repay your grant, which is mostly done through the profit gotten from the capital.
And when the business crashed at a point, the organization cancelled the loan, which is its advantage, not like others that make it mandatory to repay, even if your established business is affected in the future.
3. Soft loans
Many people are unaware of this aspect because it is extremely rare, but it is commonly used to be repaid after a certain period. Its repayment period is as easy as A.B. C due to the long scheduled time assigned to it.
4. Equity grant
What does it mean? This area is primarily carried out with the assistance of one, who is a source of supplies, and those that put in their resources in a team and, in the end, gain a profit that will be enjoyed by both the suppliers and those involved.
Advantage of the small business grant
Here are some of the pros, which are also known as the advantages of taking the grant:
1. Securing the grant
We all believe that the first thing that gives you assurance after applying for a grant is the assurance of gaining the grant. This means that having the grant available is a proof of having the capital needed to start your business. That is, you have got what it takes to build up your business. And most of the time, these grants are not paid back, and when it is required. Its repayment schedule isn’t that stressful and takes a longer period.
We all understand the aspect of the equity grant whereby an entity stands as the supplier and supervises the grant given to you most of the time as a non-governmental organization or local government. However, in this type of grant, you control your grant and decide how to use it in the establishment of your business.
4. Brand respect
How will you feel if your brand is well-known worldwide? It also stands as the advantage of the Small business grants, in addition to the loan you apply for, bringing your business before great investors. For your business to gain respect in this aspect, it is an assurance that you are truly operating a successful and profitable business that gives investors confidence to be a part of it.
5. Additional Funding
This aspect of your getting more grants is only given to those whose brands are highly respected and have been recognized by the system as a good-sustaining business to rely on, not just any SME. More support means more relationships and a more friendly attitude toward the investor and the sector.
Disadvantages of small business grants in Nigeria
1. The Greatest Rivalry
This aspect is likely to be seen in an area like this. That commonly occurs in the distribution of grants to those who apply for them. That is, they are more populated than the available loan, and in return, only a few are granted the loan among those who present their business proposal. Even if it does go round, not all of your anticipated grant will be provided.
2. Partial funding
This means that your expected funding is not granted as you thought. Apart from that, the organization would like to see you provide half of what you are expecting, which is 50 percent. This will help them round up the total cost for you. Many people found in this category most likely received grants from others in order to meet the 50% expected before SMG could put in their own contribution.
3. Specific limitations
Let’s say you present a business plan on food stuffs. Two hundred thousand is required to buy bags of rice and beans, while fifty thousand is for pictures. At this point, most of the grant providers looked into the most essential one and tried to fund it rather than all. Going with the above, they are to lessen your loan by funding businesses in the aspect of rice and beans while you sort out the pieces yourself.
4. Funding could be delayed
A lot of people that have applied for this grant are not granted it. One reason is that some grant providers sometimes ensure that you have started developing your business before they grant you funding and not that alone. They ensure that the business has attained a certain stage of success where their funding in return won’t be affected or you find it difficult to repay.
5. Prolonged application procedure
This is most seen in aspects like this, meaning it is common. The grant has a long application period to fill in before getting to you. This application process varies in its stages and expects you to have completed its application process.
6. Lack of adaptability
The final disadvantage is that you must concentrate on the specific project or business that you have designated to come in. Anything outside of the agreed-upon boundaries will result in you not receiving the grant or loan.
Steps in Applying for a World Bank Grant in Nigeria
How to Apply for World Bank grant in Nigeria
Below are the steps required or how to go with world bank grants application:
- Visit www.worldbank.org, or go through other parts like the nation or local area where it operates in order to get your loan.
Spend time developing your business plan, as most grant providers invest their intellect and courage to ensure that you only receive the most important items listed in your business plan.
Check the guidelines and procedures. When you fail to read them carefully, just as many do in accepting the terms and conditions of an organization or site, you will be limited to the chances that will help you gain the grant.
Speak with those who have been awarded the grant in the past, find out from them how they successfully got it.
Examine yourself as a person with the business plan in front of you and decide how well you are suited to carry on the business if the grant is awarded to you.
Start your application process by filling out the world bank grant application form with the help of the grant provider. In other words, use the guide and policy of the small business grant to fill in the required information.
Double-check your grant application to ensure that all required information is correctly filled in. Doing this will save you an area which might be a part of your failure to receive the grant. In addition, make a photocopy of the application form that you have filled out, after which you have to keep one for yourself while the second is submitted to further process your grant with the grant provider.