How To Get a Loan From the Development Bank of Nigeria

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It gets to a point in the existence of any and every business that more money is needed – be it for start-up, or expansion. how to get loan from development bank of nigeria

At that point, business owners would explore all available legal options to get the funds – from personal savings, friends and family, and loans.

Perhaps the most popular o the three, is approaching a financial institution for any form of loans;

it’s the most formal way to seek for funds for your business, and there’s more chance to get exactly the amount of funds needed; also,

it is the surest way to secure the funds, especially when you consider the condition of the economy,

and realise that turning to friends, family and relatives might not give the desired results.

development bank of nigeria interest rate

However, not all businesses are eligible for a loan from a commercial bank, and for small and medium sized businesses,

it is harder to know when the business is eligible or not for the kind of loans it needs,

especially when the most common sources of loans are commercial banks.

Small, and medium scale businesses are especially in some sort of fix: Already, you know that for you to build your business,

you need funds, and that applies to the possible expansion, and growth of the business,

but commercial banks may not have the facility for small and medium sized businesses to secure the loan.

how to get loan from development bank of nigeria

Granted, all businesses need money, but for small and medium sized businesses, the funds are not easily accessible from banks.

The Development Bank of Nigeria (DBN, for short), is a financial institution, borne of the partnership between the Nigerian Government

and several other international bodies; the partners include The World Bank, the African Development Bank,

The Agence Francaise de Developpment, the European Investment Bank, and kfW (which is a German Government owned development bank.

The Development Bank of Nigeria was established with the aim of providing financial

support for Micro, Small and Medium Scale Enterprises (MSMEs).

It was established solely for making loans more accessible to MSMEs, and entrepreneurial start-ups in Nigeria.

how to access development bank of nigeria loan

The Development Bank of Nigeria was established solely to help MSMEs access loans more easily,

and in this article, I would be discussing, and explaining step-by-step how to secure a loan from the Development Bank of Nigeria as business start-up.

The very good thing about the Development Bank of Nigeria is that it’s available for everyone;

so long as you are a Businessman or woman, and you operate a Medium or small scale business.

How the loan is given

At this point, I would like to explain how the loan the Development Bank of Nigeria is actually accessed.

I presume that the readers would have had some assumptions by now about how getting access to the loans DBN has to offer,

so, I’d like to guide those assumptions so as not to cause misinformation, and

miseducation. – how to get loan from development bank of nigeria

The Development Bank of Nigeria does not give these loans directly to business bodies and individuals

(it is not possible to walk into a DBN office and process a loan), rather, these loans are made available through banks,

and other Participating Financial Institutions (PFIs). So, basically, the Development Bank of Nigeria

gives a certain amount of money to the banks and other PFIs, then these banks and PFIs

would then make these money available to those who need it as loans.

development bank of nigeria grants

You may wondering “why are we coming around to banks?” but the thing is, Banks usually don’t have enough money of their own to give everyone as loans,

and actually, they would have to apply for the DBN loans themselves before they can give it out to those who need it.

So, they’re just mediums for businesses to get access to DBN’s loans. Stick around long enough, and

I’ll be outlining the banks and other places where you can access loans provided by the Development Bank of Nigeria.

What you need to get a loan from the Development Bank of Nigeria

Next, we move on to the requirements for securing a loan from the Development Bank of Nigeria.

There are not much requirements, but the few ones are very important to getting a loan from DBN.

The first thing to know, is that individuals can’t just walk into the bank and ask for a loan. – How To Get a Loan From the Development Bank of Nigeria

You will need to open an account with the Commercial Bank, Micro-finance Bank, or

other Participating Financial Institution would use to receive the loan.

Needless to say, you can’t get a loan without opening a bank account. Also, find out if the bank

you’re registering with is actually a part of the Development Bank of Nigeria’s MSMEs loan program.

How to get the Loan

Once you’ve gotten past the one most important requirement: Opening a Bank Account,

then, the next step is to visit the bank (or PFI, whichever you have an account with), and inform them of your plan to apply for the DBN’s loan.

This is with the knowledge of the fact that your bank is actually part of the DBN program – how to get loan from development bank of nigeria

(not all banks in Nigeria are participating, and if your bank isn’t one of the participatory ones,

they might tell you at that point of your asking, but anyway, I would list out the names of participatory banks as we move on in this article).

development bank of nigeria lagos

Upon your request, your bank would like to know why you need a loan, so they’ll interview you.

They would like to know precisely why you need a loan, and the onus is on you to provide with good, genuine reasons for asking for the loan.

Reasons such as using the loan to start up a business model, or expanding a current business How To Get a Loan From the Development Bank of Nigeria

are some of the tenable reasons the banks can accept for a loan application.

If you get past the interview, the next thing your bank, or PFI, would do is to conduct an assessment.

Based on the reason you’ve tendered, the bank would then conduct assessment on it; so, if you’ve stated that you want a loan to start-up a business,

the bank would conduct an assessment on the business, study its feasibility and market analysis and determine if it is eligible for a loan.

how to get loan from development bank of nigeria

development bank of nigeria loan interest rate

Likewise, if you mean to use the loan for expanding an existing business, they would carry out an assessment and some feasibility study on the business.

If your bank thinks it’s okay to grant you a loan, they then apply to the Development Bank of Nigeria for the funding of that loan.

Then, usually shortly afterwards, the application gets approved, and the funding is available to be disbursed;

they would send the money down to the bank or PFI. In short order, the loan would then be forwarded to you. How To Get a Loan From the Development Bank of Nigeria

That’s the procedure to get a loan from the Development Bank of Nigeria, might seem long, but It’s pretty straightforward.

Interest Rate and all the other stuff

I would be talking about the Interest rate and the general terms and conditions of a DBN loan.

You’d be happy to know that a loan from the Development Bank of Nigeria has the best interest rate there is; this shouldn’t be surprising though, since

The Development Bank of Nigeria was established for Small and Medium Scale enterprises after all,

and it follows if they support these enterprises with favourable interest rates.

how to get loan from development bank of nigeria

However, there are some factors that influences the interest rate: it’s favourable, but not fixed.

One major factor that decides what the interest rate would be, is for how long you would be needing the loan for;

unsurprisingly, the longer you’d need the loan, the higher the interest rate.

Then, there’s the Collateral Requirement, which would be determined by the bank form which you’ve registered the loan.

development bank of nigeria logo

Collateral requirement varies from individuals to individuals, and the bank or PFI would

usually conduct other assessment of the business, such as the location, and the amount of loan requested.

Once the bank or PFI consider the assessment of the business, they would then make

the decision of what the collateral requirement would be based on their own risk assessment.

Paying back the loan is really flexible. The Development Bank of Nigeria has made its loan repayment easy enough,

as you start the repayment from 18 months, and take up to 10 years to pay up (although,

repayment time is subject to the amount of the loan, the purpose of the loan and the nature of the business)

Wrapping it up – how to get loan from development bank of nigeria

As I conclude this guide, I would be outlining the names of banks and Participating Financial Institutions

that are eligible for a loan from the Development Bank of Nigeria, the following are the names of the banks and PFIs:

  • Ecobank Nigeria Bank PLC
  • Fidelity Bank PLC
  • UBA PLC
  • Wema Bank PLC
  • FCMB Ltd
  • AB Microfinance Bank
  • Addosser Microfinance Bank
  • Baobab Microfinance Bank
  • Bosak Microfinance Bank
  • Infinity Microfinance Bank
  • LAPO Microfinance Bank
  • Microlad Microfinance Bank
  • NPF Microfinance Bank

development bank of nigeria (dbn) abuja

The Development Bank is here for MSMEs, and that means more accessible loans to more people.

For enquiries and complaints, the DBN actually has physical offices, and their head office is at Abuja:

The Clan Place, Plot 1386A Tigris Crescent, Maitama, Abuja. They’ve also got an office at Lagos: Plot 952/953 Idejo Street, Victoria Island, Lagos.

Their phone numbers are +234-9-904-0000, +234-811-3841-699; their e-mail is [email protected],com. and their website is www.devbankng.com.

For enquiries and complaints, the DBN actually has physical offices, and their head office is at Abuja:

The Clan Place, Plot 1386A Tigris Crescent, Maitama, Abuja. They’ve also got an office at Lagos:

Plot 952/953 Idejo Street, Victoria Island, Lagos. Their phone numbers are +234-9-904-0000,

+234-811-3841-699; their e-mail is [email protected],com. and their website is www.devbankng.com.

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