Nigeria’s Bank of Industry (BoI) just launched an online SME Loan Application platform to help reduce the stress of applying for the different types of business loans available to SMEs in the country.
The website allows you to apply for SME loan, track the approval progress and even select the BoI regional office you’d want to interface with.
This obviously represents a step in the right direction – though it remains to be seen how effective this will work considering the level of bureaucracy and bottlenecks that bedevils government agencies.
The Bank of Industry (BOI) is Nigeria’s oldest, largest and most successful development financing institution. It was reconstructed in 2001 out of the Nigerian Industrial Development Bank (NIDB) Limited, which was incorporated in 1964 with a mission “To transform Nigeria’s industrial sector by providing financial and business support services to enterprises”.
Who Can Benefit from BoI Loans?
- Small, medium and large enterprises, excluding cottage industries.
- New or existing companies, seeking expansion, mordenisation or diversification.
- Credit worthy promoters who will be required to prove their commitment to the project by contributing at least 25% of the project cost excluding land.
- Borrowers whose management capability, financial situation (including availability of collateral and guarantee), character and reputation are incontrovertible.
- Clients with demonstrable ability to meet loan repayments.
- Borrowers with no record of unpaid loans to erstwhile development finance institutions and other banks.
Criterias For Approval
According to their website, “the bank’s emphasis is on prudent project selection and management, accordingly, it supports quality projects with potential developmental impact.” BOI considers industries that meet the following criteria:
- Capacity to substantially add to industrial output.
- Projects that use largely domestic raw materials.
- Industry in which Nigeria’s comparative advantages could be converted to competitive ones.
- Ability to promote the expansion of exports through the production of high quality products that are attractive to domestic and export markets.
- Niche projects that produce for worldwide consumption.
- Projects that create both forward and backwards linkages, with the rest of the domestic or regional economy.
- Ventures that promote inter-state or regional integration.
- Small and medium enterprises (SMEs) that have linkage with large firms, belong to clusters and operate under franchise.
- Enterprises with high employment generation capacity.
- The project must be technically feasible, commercially viable and economically desirable.
- Projects that are environmentally friendly.
- Enterprises that have good management set-up and proper accounting procedures.
- Enterprises promoted by women entrepreneurs.
The following industrial sub-sectors are also accorded priority in the project selection:
- Agro-industries, textile and leather
- Polymer –based industries
- Solid minerals
- Information communication technology (ICT) services
If you’d give this a try – we would love to hear your progress.