CBN Loans and how to access them
CBN loans have been a hot topic in Nigeria amongst Micro Small and Medium Enterprises (MSMEs) for a while now. Many MSMEs have tried to access these low-interest loans and failed. Many of these MSMEs don’t even believe that the funds are really available for MSMEs. The Central Bank of Nigeria together with other MSME stakeholders are trying hard to change that.
Well, I have got good news for you.
These low-interest loans exist, they are available to businesses in different sectors such as the creative sector, manufacturing, technology, and agric. These loans are mostly structured as equipment loans, where the bulk of the loan is used in securing equipment critical to the success or expansion of a business. The remaining part of the loan is structured as working capital.
There is no doubt that access to Finance is one of the major stumbling blocks to MSMEs, but before small businesses can access these CBN loans, they would need to have fulfilled a few critical requirements.
- These loans are not for businesses still being run from the backyard of the house, in other words, you must have business premises different from where you live.
- Your business is duly registered with the CAC
- Your business is not looking for funding to build structures. Eg Real Estate, School building expansion, restaurant buildings etc. even though BOI can fund a generator for your school.
- Mobile equipment, eg vehicles, will not be funded by BOI loans
- Meet all the other technical requirements like having a business plan, guarantors etc.
Another important mechanism that has been put in place is that MSMEs that want to access these loans must work with accredited BDSPs, Business Development Support Professionals. These are professionals in different fields who have had sufficient experience with MSMEs and who can guide them in putting together a coherent business plan, help prepare their accounts, create effective marketing strategy etc.
The BDSPs are certified by SMEDAN, Small and Medium Enterprise Development Agency of Nigeria, and they take a certification exam to become Certified BDSPs.
Together with 40 other BDSPs, I took the BDSP certification exam at the Enterprise Development Centre in late February 2020, and now have access to a wide range of highly experienced BDSPs from different disciplines from export to agric, to banking and digital.
If you think your business qualifies for one of the CBN loans, click here to fill out this form.