If you own a business in Nigeria and you need funds to grow, you may be asking how to get a business loan in Nigeria.

This guide will walk you through everything you need to know: what you must prepare, where to apply, how the process works, how much you might borrow, and what mistakes to avoid. By the end you’ll be ready to apply and increase your chances of success.

What It Means to Get a Business Loan in Nigeria

To get a business loan in Nigeria means you borrow money from a bank, microfinance institution, fintech lender, or government scheme, and you agree to pay it back with interest over time. The loan may be for working capital, buying equipment, expanding, or injecting cash into your operations.

Borrowing responsibly can help your business grow, but applying without preparation can lead to rejection or financial trouble. That’s why you must understand the steps and requirements clearly.

Why You Might Want to Get a Business Loan in Nigeria

There are many good reasons to get a business loan in Nigeria:

• You want to expand your business premises or open a new branch. 
• You need to buy machinery or equipment to increase production. 
• You have confirmed orders (purchase orders) that need cash to fulfil. 
• You need cash for day-to-day operations when sales are slow. 
• You want to invest in marketing or inventory ahead of peak season. 

When you apply for a business loan in Nigeria with a clear purpose and plan, your chances of approval improve.

Who Can Get a Business Loan in Nigeria

Eligibility varies by lender, but generally you can apply for a business loan in Nigeria if:

• You are a Nigerian citizen or have legal residence and business registration. 
• Your business is registered (e.g., with the Corporate Affairs Commission) or has legal status. 
• You provide valid identification (National ID, driver’s licence, passport). 
• You have a business bank account and some business activity. 
• You can show you will repay the loan (through income, invoice, order, or cash flow). 

For example, some fintech lenders offer business loans with no collateral if you can show verified invoices or purchase orders. 

Step-by-Step: How to Get a Business Loan in Nigeria

Here is a step-by-step process to help you successfully get a business loan in nigeria

Step 1: Decide Exactly Why You Need the Loan

Write down how much money you need and what you will use it for. Lenders will ask for this. A clear purpose strengthens your application.

Step 2: Review Your Business Status and Financials

Check your business registration, bank account, cash flow, invoices. Ensure your accounts are reasonably in order. If your business is new, you might need extra documentation or a smaller loan.

Step 3: Research Lenders and Loan Products

Look at banks, microfinance institutions, fintech platforms, government-supported schemes. Compare: interest rate, loan amount, repayment term, collateral requirement, speed of approval.
For example:

• Moniepoint Microfinance Bank offers working-capital loans with low collateral and quick approval. 
• Bank of Industry (BOI) provides single-digit interest loans to SMEs. 

Step 4: Prepare the Documents

Typically you’ll need:

• Valid ID (National ID, Passport, Driver’s Licence) 
• Business registration certificate 
• Business bank account statements (3-6 months) 
• Business plan / loan purpose statement 
• Purchase orders or invoices if required 
• Any collateral documentation if needed 

Step 5: Apply for the Loan

Fill the lender’s application form, upload or submit required documents, state your loan amount and purpose clearly. Be honest and accurate.

Step 6: Wait for Approval and Disbursement

After submission the lender will review your file, assess risk, check business viability and creditworthiness. If approved, you’ll get a loan offer with terms (interest rate, repayment schedule). Once you accept, funds are disbursed.

Step 7: Use the Funds Wisely and Repay On Time

Once you receive your funds, use them for the purpose stated. Keep proper records, pay your instalments on time. Doing this builds trust and can help your business relationships and credit future borrowing.

How Much Can You Borrow and What Are Typical Terms?

When you consider how to get a business loan in Nigeria, it helps to know current norms:

• Some fintech lenders offer short-term working capital loans from around ₦1,000,000 with low or no collateral. 
• Banks offer larger loans: for example, FCMB offers up to ₦5 billion for SMEs for asset financing, working capital etc. 
• Interest rates vary widely depending on lender, risk, collateral, and business size. 
• Repayment terms can range from 6 months to several years. 
• Some lenders specialise in invoice financing or purchase-order financing where you don’t need assets. 

Always check the total cost of the loan (interest + fees + other charges) before committing.

What Lenders Look For When You Want to Get a Business Loan in Nigeria

To increase your chance to get a business loan in Nigeria, know what lenders examine:

• Business registration and legal status. 
• Bank account activity and transaction history. 
• Clear purpose for the loan and how you will repay. 
• Cash flow or revenue proof (invoices, sales records) showing you can service the loan. 
• Collateral or guarantee (if required). Some lenders waive collateral for invoice or PO financing. 
• Credit history or business duration. New businesses may need stronger documentation or smaller loans. 

If you address these items before applying, your chance to get approved improves.

Common Mistakes to Avoid When Trying to Get a Business Loan in Nigeria

While many entrepreneurs try to get a business loan in Nigeria, mistakes are common. Avoid these:

• Applying without a clear plan – lenders want to know exactly how you will use the money. 
• Using fiction or inflated numbers – honesty matters. 
• Ignoring the total cost – high interest or steep fees kill value. 
• Borrowing too much too soon – over-borrowing increases risk. 
• Failing to keep records and receipts – you may be audited or asked to show use of funds. 
• Choosing lenders without checking terms or reputation – poor terms or hidden fees trap businesses. 
• Neglecting repayment – missing instalments hurts credit and future borrowing. 

Avoiding these mistakes increases your chance to get a business loan in Nigeria and use it wisely.

Tips to Improve Your Chance to Get a Business Loan in Nigeria

Here are practical tips that can help you successfully get a business loan in Nigeria:

• Register your business officially (CAC) and open a business bank account. 
• Keep bank statements and invoices for at least 3-6 months. 
• Build a simple business plan showing your business, how the loan will be used, and how it will generate revenue. 
• Start with a smaller loan or shorter term if your business is new, then scale up later. 
• Choose a lender that fits your size, budget and industry. Some fintech lenders specialise in small loans. 
• If you have assets, use them as collateral for better terms, but consider the risk. 
• Compare at least 2-3 lenders: interest rate, fees, repayment term, collateral. 
• Read the fine print: check for hidden charges, prepayment penalties, grace period, default terms. 
• Use the loan funds strictly for the purpose stated – this helps you stay on track and strengthens your reputation. 
• Plan repayment carefully: look at monthly cash flow and ensure you can make the payments. 

By following these tips you position your business for success when applying.

Is It Risky to Get a Business Loan in Nigeria?

Yes, borrowing always carries risk. When you get a business loan in Nigeria, you assume an obligation to repay. If you cannot repay, you could damage your credit, lose collateral, incur legal issues or be unable to borrow again.

To reduce risk: borrow only what you need, use the funds for revenue-generating activity, monitor cash flow carefully, repay on time, and keep good records. With proper management, a business loan becomes a tool for growth instead of a burden.

What’s Next After You Get a Business Loan in Nigeria

Once you are approved and receive the funds, your next steps are:

• Use the funds as planned: equipment, inventory, expansion etc. 
• Record every transaction and keep documentation. 
• Monitor your cash flow and business performance closely. 
• Make sure you meet repayment deadlines. 
• Build your credit history: timely repayment helps your reputation and future borrowing. 
• Evaluate the results: did the loan help your business grow? What did you learn for next time? 

This way, your loan becomes a stepping stone, not a stumbling block.

Conclusion

If you want to get a business loan in Nigeria, you must prepare carefully, choose the right lender, apply with proper documentation, and use the funds wisely. When you follow the steps and avoid the common mistakes, the loan can transform your business.

Take action now: define your loan need, prepare your documents, research lenders, apply, and track your results. You can turn the opportunity into real growth for your business.

Also Read:Business Grants vs Business Loans in Nigeria: Which is Right for You in 2025?