Starting up a business in Nigeria could be nerve tasking especially when there are no funds, but thanks to Bank of Industry that sees to the provision of loan facilities for businesses that are into manufacturing and processing activities.

Bank of Industry: Five Things You Need To Know


Starting up a business in Nigeria could be nerve tasking especially with limited funds but the Bank of Industry that sees to the provision of loan facilities for businesses that are into manufacturing and processing activities might be a worthy option. The main goal of the Bank of industry is to pump money into the industrial sector of the economy, ensuring that Nigerians get access to loans easily. Here are five things you should know about Bank of Industry.

1. Loan Approval takes a gestation period of 2 to 4 weeks

With a good business plan, properly written and convincing enough, it can take as little as 2 to 4 weeks for the requested loan to be approved. While the main aim of the Bank of Industry is to provide loans to applicants but they are passive about that. They go the extra mile to making sure your loan request is granted. They do this by appointing business development support providers to assist in every step of the way, so that you can generate profits and meet your business objectives and above all be able to repay your loan.

However, one of the things that made it possible for the Bank of Industry to process these loan offers within this 4 weeks period is because it already has a network of partners in financial institutions (commercial banks). What this means is that the Bank of industry enters into a negotiation term with these banks, the terms, SME-friendly financing terms.

2. It does not give out loans cash

The Bank of Industry does not give out a loan in cash rather it disburses the loans to the vendors or suppliers the loans are meant for. People are dodgy and the Bank of industry discovered that most people don’t have any feasible business plan and if given the money to such people, they might not be able to repay loans. 

There are stories to loans, the Tony Elumelu Foundation is one foundation that quite a number of entrepreneurs have bastardized. Most times when they are given funds to finance their businesses, they go home to live a life of affluence.

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The Bank of industry carries out a good feasibility study on the equipment you quoted for purchase, it also contacts the vendors and agree on prices with them. Most of the time, they advise loan applicants to go for local machines, they do this in order to make sure there would be spare parts of the machines should in case it breaks down.

However, the bank of industry does not finance raw materials, nor lands or building. They are only interested in financing machines needed for business.

3. It recently injected N1 billion naira into the fashion industry

The BOI fashion fund was launched in 2015, and in March, 2018, the BOI injected some funds into the world of fashion. If you’re into fashion and you need funds to expand your business, the Bank of Industry could be helpful, only if you meet the requirements of the loans. Beneficiaries could receive up to 30 million naira in loans Here are the eligibility terms.

  • “Duly registered within Nigeria as Limited Liability Companies and operate in the fashion industry.
  • Shareholding with 51% female ownership
  • Operating license from relevant agencies
  • A factory or production center to operate from
  • Sustainable business model
  • Positive net worth
  • Use at least 20% local content
  • A minimum of 60% Nigerian ownership”

If an application for a loan is approved, successful applicants are expected to pay an approval fee which is 1% of the loan amount requested.

4. There is massive fraud going on within the institution

It is unfortunate and very worrisome that almost every institution is Nigeria is plagued with fraud and corruption. Money is changing hands illegally and it sometimes runs into billions of Naira. There is a contention that businesses which qualify for these loans are not been contacted. It is has sometimes fallen to the level of who knows who. 

Also, there is an ongoing rumour that the BOI is collecting billions of naira from state governments across the country in disguise for the expansion of small-scale industries but there has not been a beneficiary of such funds.

5. Flexible collateral requirements

You can assess BOI loans with a flexible collateral. What discourages most people from obtaining loans in the bank most times is the collateral. However, the BOI collateral is easy, at least on paper, because they don’t lay much emphasis on Certificate of Occupancy as one of their requirements. But you will need to provide the following:

“Debenture on assets of your company, bank Guarantee, external guarantors with a notarized statement of Net worth for loans below N10 million.”

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