How to Get a Business Loan from the Development Bank of Nigeria
Is financing your business bothering you just as many Nigerians wishing to start a business are struggling to build their dream business with the main obstacle being financing the business. Also, some existing business also needs extra capital to meet up public demand. With the little loan, the commercial bank and other financial institutions could issue to the public which is not streamlined only to the micro, small and medium scale businesses. This is what led to the emergent of the Development Bank of Nigeria (DBN).
In simple terms, the main purpose of the development bank of Nigeria is to alleviate the financial problems faced by small business, medium scale businesses, Entrepreneurs, and start-ups in Nigeria.
What is the Development Bank of Nigeria?
The development bank of Nigeria is a financial organization that was created by the Nigerian government. It has partnerships with several international bodies including the world bank, African development bank, European investment bank, etc. If you own micro, small, or medium-scale enterprise (MSMEs) DBN was created for you to get financial support to run your business. The development bank encourages the growth of small businesses and start-ups by giving those loans that will enable them to lighten the financial burden of their business.
Who are qualified to access the loan? – Business Loan from the Development Bank of Nigeria
Unlike any other bank that gives out loan to any sector of the economy, the Development Bank of Nigeria only issues loans to: • Start-ups business • Entrepreneurship business • Small scale business • Medium-scale business Any other business asides from the above-stated businesses are not qualified to apply for a DBN loan.
Steps to get business loans from the Development Bank of Nigeria.
It’s important to note that The Development Bank of Nigeria doesn’t relate directly to you as a businessman or businesswoman. Rather, through different approved Participating Financial institutions which includes commercial banks, microfinance banks, and development finance institutions, which plays the role of a middleman. The procedural steps in getting DBN loans are as follows;
1. Opening a Bank account or a PFI account
If you want to apply for a loan from DBN, you must have an account with an eligible commercial bank, microfinance bank, or participating financial institutions (PFIs). This is the first step in applying for a loan from the Development Bank of Nigeria. The development bank of Nigeria does not give its loans directly to the business bodies or individuals; rather, DBN loans are paid through commercial banks, a microfinance bank, and other participating financial institutions (PFIs).
2. Visit the bank or any PFI close to you
Visit your eligible bank to apply for a DBN loan. Your business will be appraised by your bank, once your business is found qualified, your bank will apply for the loan on your behalf. If your loan is being granted, the development bank of Nigeria will then disburse the funds through your bank to you.
3. Appraises your request
Upon your request, your bank will want to know why you need a loan, so they will conduct an interview for you. Your bank is interested in knowing precisely what the DBN loan is needed for, and the onus is on you to provide good, genuine reasons for asking for the loan
After completing the assessment, the bank will verify your business, if you had stated in your interview, you had already commenced business. It is important to note that, all small scale and medium scale businesses are eligible for a loan from the development bank of Nigeria.
5. Conduct assessment on request
If you successfully pass the interview, the next step is for your bank or PFI to conducting an assessment. Based on the reasons you have stated earlier to the bank, the bank or PFI would then conduct an assessment of the information you have provided.
6. Approval of request
If the development bank of Nigeria approves the loan from the bank on your behalf, the development bank of Nigeria will disburse the bank for on-lending to your business. The banks are then expected to give you the loan it has received from the Development Bank of Nigeria