The COVID-19 pandemic has had a devastating impact on the Nigerian economy, and many businesses and individuals are struggling to make ends meet. If you’re one of those affected, you may be wondering if there’s anything you can do to get back on your feet.

One option is to apply for a COVID-19 loan. There are a number of different loan programs available, both from the government and from private lenders. In this blog post, we’ll walk you through the steps of how to apply for a COVID-19 loan in Nigeria.

First, you’ll need to decide which loan program is right for you. There are a number of factors to consider, such as the amount of money you need, the interest rate, and the repayment terms. Once you’ve chosen a program, you can start the application process.

The application process for a COVID-19 loan will vary depending on the lender. However, most lenders will require you to provide some basic information, such as your name, address, contact information, and financial history. You may also need to provide documentation to support your application, such as proof of income or tax returns.

Also read: Best Mobile Loan Apps In Nigeria

What is a COVID-19 loan?

A COVID-19 loan is a type of loan that is specifically designed to help businesses and individuals who have been financially affected by the COVID-19 pandemic. COVID-19 loans typically have lower interest rates and longer repayment terms than traditional loans.

Who is eligible for a COVID-19 loan in Nigeria?

To be eligible for a COVID-19 loan in Nigeria, you must meet the following criteria:

You must be a Nigerian citizen or resident.
You must be a business owner or self-employed individual.
You must have been financially affected by the COVID-19 pandemic.

We know that the COVID-19 pandemic has been tough on everyone, and businesses have been especially hard hit. That’s why the Nigerian government has launched a number of loan programs to help businesses and households recover from the financial impact of the pandemic.

If you’re thinking about applying for a COVID-19 loan, the first thing you need to do is check your eligibility. Here’s a quick overview of the eligibility requirements for the most popular COVID-19 loan programs in Nigeria:

How to apply for a COVID-19 loan in Nigeria

To apply for a COVID-19 loan in Nigeria, you can either apply online or at a physical branch of a participating lender.

To apply online, you will typically need to provide the following information:

Your personal information (name, address, contact information, etc.)
Your business information (name, address, type of business, etc.)

Your financial information (income, assets, liabilities, etc.)

To apply at a physical branch of a participating lender, you will typically need to bring the same information as above, as well as any additional documentation that the lender may require.

Agric Small and Medium Enterprise Scheme (AGSMEIS): This program is open to small and medium enterprises (SMEs) in the agricultural sector. To qualify, businesses must have been in operation for at least six months and have a turnover of less than N50 million.

NIRSAL Microfinance Bank (NMFB) COVID-19 Loan: This program is open to both households and SMEs. To qualify, households must have verifiable evidence of livelihood adversely impacted by COVID-19. Businesses must have bankable plans to take advantage of opportunities arising from the COVID-19 pandemic.
Central Bank of Nigeria (CBN) Targeted Credit Facility (TCF): This program is open to households and businesses that have been adversely affected by the COVID-19 pandemic. To qualify, businesses must have a turnover of less than N50 billion and have been in operation for at least two years.

If you meet the eligibility requirements for any of these programs, you can start the application process by visiting the website of the lending institution. The application process is typically straightforward, and you’ll need to provide some basic information about your business or household.

Once you’ve submitted your application, it will be reviewed by the lending institution. If your application is approved, you’ll receive your loan funds within a few weeks.

Here are some examples of eligible businesses:

Restaurants

Hotels
Travel agencies
Retail stores

Manufacturing companies
Agricultural businesses
Service providers

If you’re not sure if you’re eligible, you can check with the NIRSAL Microfinance Bank (NMFB), which is responsible for administering the loan program.

What types of COVID-19 loans are available in Nigeria?

There are a variety of COVID-19 loan programs available in Nigeria, including:

Micro, small, and medium enterprise (MSME) loans: These loans are designed to help MSMEs recover from the pandemic and grow their businesses.

Household loans: These loans are designed to help households cover basic expenses such as food, rent, and healthcare.
Individual loans: These loans are designed to help individuals cover personal expenses such as education, medical bills, and debt consolidation.

What documents do I need to apply for a COVID-19 loan in Nigeria?

The specific documents that you need to apply for a COVID-19 loan will vary depending on the lender. However, most lenders will require the following documents:

Moveable asset(s) duly registered on the National Collateral Registry (NCR);
Deposit of title documents, in perfectible state;
Deed of Debenture (for stocks) in perfectible state;

Irrevocable domiciliation of proceeds;
Two (2) acceptable Guarantors;
Personal Guarantee of the promoter of the business;

Life Insurance of the Key-Man, with NMFB noted as the First Loss Payee; and
Comprehensive Insurance over the asset.

Also, note that these requirements could be more or less, depending on the specific type of loan you are applying for. However, all applications usually contain the documents as stated above.

What are the benefits of COVID-19 loans?

The COVID-19 pandemic has had a devastating impact on the Nigerian economy, especially on small and medium-sized enterprises (SMEs) and households. In an effort to mitigate the effects of the pandemic, the Central Bank of Nigeria (CBN) introduced the N50 billion Targeted Credit Facility (TCF) in 2020. The TCF is a stimulus package designed to support SMEs and households that have been adversely affected by the COVID-19 pandemic.

The TCF offers a number of benefits to eligible borrowers, including:

Access to affordable credit: The TCF offers loans at a concessionary interest rate of 5% per annum. This is significantly lower than the prevailing interest rates in the Nigerian market, making it more affordable for borrowers to access credit.

Long repayment terms: The TCF offers loans with repayment terms of up to five years. This gives borrowers ample time to repay their loans without undue financial strain.
Moratorium period: The TCF offers a moratorium period of up to six months on all loan repayments. This means that borrowers do not have to start repaying their loans until six months after they have received the loan.
Collateral-free loans: The TCF offers collateral-free loans to eligible borrowers. This makes it easier for borrowers to access credit, especially those who do not have any collateral to offer.

The TCF has been a lifeline for many SMEs and households in Nigeria. It has helped them to stay afloat during the pandemic and to start rebuilding their businesses. The TCF has also played a role in stimulating economic growth in Nigeria.

What are the drawbacks of COVID-19 loans?

The COVID-19 pandemic has had a devastating impact on the Nigerian economy, with many businesses and individuals struggling to stay afloat. In response, the government and financial institutions have introduced a number of COVID-19 loan schemes to help businesses and individuals recover.

However, there are a number of drawbacks to COVID-19 loans that potential borrowers should be aware of before applying.

High interest rates

One of the biggest drawbacks of COVID-19 loans is the high interest rates that are often charged. This can make it difficult for borrowers to repay the loan, especially if their business or income has been affected by the pandemic.

Short repayment terms

Another drawback of COVID-19 loans is the short repayment terms that are often required. This can put pressure on borrowers to repay the loan quickly, even if they are not yet in a financial position to do so.

Difficult eligibility criteria

Many COVID-19 loan schemes have strict eligibility criteria, which can make it difficult for some businesses and individuals to qualify. This is especially true for small businesses and individuals who have been disproportionately affected by the pandemic.

Collateral requirements

Some COVID-19 loan schemes require borrowers to provide collateral, such as property or vehicles. This can be a barrier for borrowers who do not have any assets to offer as collateral.

Risk of fraud

There is also a risk of fraud associated with COVID-19 loans. Some scammers may try to take advantage of borrowers by offering fake loans or charging high upfront fees.

Overall, COVID-19 loans can be a helpful way for businesses and individuals to recover from the financial impact of the pandemic. However, it is important to be aware of the drawbacks before applying for a loan.

How do I apply for a COVID-19 loan in Nigeria?

To apply for a COVID-19 loan in Nigeria, you can either visit a participating bank or apply online. If you choose to apply online, you will need to create an account with the lender and provide the required documentation.

Once you have submitted your application, the lender will review it and make a decision. If your application is approved, the lender will disburse the loan to you.

How to apply:

To apply for a COVID-19 loan, you can visit the website of the NIRSAL Microfinance Bank (NMFB), which is the CBN’s partner in disbursing these loans.

On the NMFB website, you will need to create an account and then fill out an online application form. The application form will ask for your personal information, business information, and financial information. You will also need to provide supporting documentation, such as your BVN number, business registration certificate, and financial statements.

Once you have submitted your application, it will be reviewed by the NMFB. If your application is approved, you will be able to receive your loan within a few days.

Interest rates and terms

The interest rate on COVID-19 loans is 9% per annum. The maximum loan amount for households is N3 million, and the maximum loan amount for MSMEs is N25 million.

The loan term for working capital loans is one year, with no option for rollover. The loan term for term loans is three years, with a one-year moratorium on repayment.

Approval process:

The NIRSAL MFB will review your application and assess your eligibility. If your application is approved, you will be notified and the loan funds will be disbursed to you.

What is The Collateral Requirement for COVID-19 loans in Nigeria

The collateral requirement for COVID-19 loans in Nigeria varies depending on the lender and the type of loan. However, most lenders will require some form of collateral, such as a personal guarantee, a business asset, or a government guarantee.

The Central Bank of Nigeria (CBN) has introduced a number of measures to support businesses and households during the COVID-19 pandemic, including the Targeted Credit Facility (TCF). The TCF is a N50 billion loan facility that is available to micro, small, and medium-sized enterprises (MSMEs) and households that have been affected by the pandemic.

The collateral requirement for the TCF is 70% of the loan amount. However, the CBN has also stated that it will consider providing collateral waivers for MSMEs that are unable to meet the collateral requirement.

Other lenders, such as commercial banks and microfinance institutions, may have different collateral requirements for their COVID-19 loans. For example, some banks may require a personal guarantee from the borrower, while others may require collateral in the form of a business asset, such as inventory or equipment.

If you are considering applying for a COVID-19 loan in Nigeria, it is important to contact the lender directly to inquire about their collateral requirements.

What is the interest rate of the COVID-19 loan in Nigeria?

The interest rate of the COVID-19 loan in Nigeria is 9% per annum. This is the interest rate on all Central Bank of Nigeria (CBN) intervention facilities, which includes the COVID-19 Targeted Credit Facility (TCF).

The CBN had reduced the interest rate on all its intervention facilities from 9% to 5% per annum in March 2020, as part of measures to mitigate the negative impact of the COVID-19 pandemic on the Nigerian economy. However, the CBN increased the interest rate back to 9% per annum in July 2022.

The COVID-19 TCF is a N50 billion loan scheme designed to provide affordable and accessible credit to households and businesses affected by the COVID-19 pandemic. The loan is available to micro, small, and medium-sized enterprises (MSMEs), as well as households with verifiable income.

What is the loan tenor of the COVID-19 loan in Nigeria?

The loan tenor of the COVID-19 loan in Nigeria is three years, with a one-year moratorium on repayments. This means that borrowers have one year before they have to start making repayments.

The COVID-19 loan is a term loan, which means that it is repaid in equal installments over the course of the loan term. The interest rate on the loan is 9%, and the loan amount is limited to N25 million for small and medium-sized enterprises (SMEs) and N3 million for households.

The COVID-19 loan is available to businesses and households that have been affected by the COVID-19 pandemic. To be eligible, borrowers must have a valid Bank Verification Number (BVN) and business registration (where applicable).

To apply for the COVID-19 loan, borrowers must submit an application to the NIRSAL Microfinance Bank (NMFB). The application must include a business plan with clear evidence of the opportunity or adverse impact as a result of the COVID-19 pandemic.

Once the application has been approved, the loan will be disbursed to the borrower’s bank account. Repayments must be made on an installment basis according to the repayment schedule/work plan provided at the application stage.

What is the loan limit of the COVID-19 loan in Nigeria?

The COVID-19 loan in Nigeria, also known as the Targeted Credit Facility (TCF), has a loan limit of N25 million for MSMEs and N3 million for households.

The TCF was introduced by the Central Bank of Nigeria (CBN) in March 2020 to support households and businesses affected by the COVID-19 pandemic. The loan is available to businesses in all sectors of the economy, including agriculture, manufacturing, trade, and services.

To be eligible for the TCF loan, businesses must have been in operation for at least one year and have a valid Business Registration Number (BNN). Households must have a valid Bank Verification Number (BVN).

The TCF loan has a tenor of up to three years and an interest rate of 9%. There is also a one-year moratorium on repayments, which means that borrowers do not have to start repaying the loan for one year after it is disbursed.

To apply for the TCF loan, businesses and households can visit the NIRSAL Microfinance Bank website. The application process is online and takes about 15 minutes.

If you are a business owner or household head who has been affected by the COVID-19 pandemic, I encourage you to apply for the TCF loan. It is a great opportunity to get the financial support you need to recover and grow your business or household.

What Is The Working Capital of The COVID-19 Loan in Nigeria?

The working capital of the COVID-19 loan in Nigeria is the amount of the loan that can be used to cover the day-to-day operational expenses of a business. This includes things like salaries, rent, inventory, and other costs associated with running a business.

The working capital of the COVID-19 loan can vary depending on the size and type of business, as well as the specific needs of the business owner. However, in general, the working capital of the loan is typically between 50% and 75% of the total loan amount.

The COVID-19 loan in Nigeria is a government-backed loan program that was created to help businesses that were impacted by the COVID-19 pandemic. The loan is available to businesses of all sizes and types, and the terms of the loan are very favorable.

The interest rate on the COVID-19 loan is 5%, and the repayment term is up to 5 years. Additionally, there is a 6-month moratorium on all repayments. This means that businesses do not have to start making payments on the loan until 6 months after they receive the loan.

The COVID-19 loan is a great option for businesses that are looking for working capital to help them get through the pandemic. The loan is easy to apply for, and the terms of the loan are very favorable.

If you are a business owner in Nigeria and you are interested in applying for the COVID-19 loan, you can visit the website of the Central Bank of Nigeria for more information.

What can I use the COVID-19 loan funds for?

I know you’re probably wondering what you can use your COVID-19 loan funds for in Nigeria. Well, I’m here to tell you that there are a lot of options!

The Central Bank of Nigeria (CBN) has provided a list of eligible activities that can be funded with COVID-19 loan proceeds. These include:

Working capital: This can be used to cover expenses such as salaries, rent, and utilities.

Asset acquisition: This can be used to purchase new equipment or inventory.
Debt refinancing: This can be used to pay off existing debt at higher interest rates.
Business expansion: This can be used to finance new projects or ventures.

In addition to these general categories, there are also a number of specific sectors that are eligible for COVID-19 loans. These include:

Healthcare: This can be used to fund the purchase of medical supplies and equipment, or to finance the construction or renovation of healthcare facilities.
Agriculture: This can be used to finance the purchase of seeds and fertilizers, or to finance the construction or renovation of agricultural processing facilities.

Manufacturing: This can be used to finance the purchase of raw materials and equipment, or to finance the construction or renovation of manufacturing facilities.
Trade: This can be used to finance the importation or exportation of goods, or to finance the construction or renovation of торговые объекты.

So, what can you use the COVID-19 loan funds for?

For businesses, the loan funds can be used for a variety of purposes, including:

Covering operating costs: This could include things like rent, utilities, payroll, and inventory.
Expanding or upgrading your business: If you have plans to expand or upgrade your business, the loan funds can help you make those plans a reality.

Refinancing existing debt: If you have existing debt that is weighing you down, the loan funds can be used to refinance that debt at a lower interest rate.

For households, the loan funds can be used for a variety of purposes, including:

Paying for essential expenses: This could include things like food, rent, and utilities.

Covering medical expenses: If you or a family member has been sick with COVID-19, the loan funds can be used to cover medical expenses.
Starting a new business: If you’ve been thinking about starting your own business, the loan funds can help you get off the ground.

Here are some specific examples of how you can use your COVID-19 loan funds:

Buy new equipment for your business, such as computers, software, or machinery.
Hire new employees or expand your team.
Purchase inventory or raw materials.

Pay for marketing and advertising costs.
Renovate or expand your business premises.
Finance research and development.

Cover your living expenses while you’re unemployed or underemployed.
Pay for tuition fees or other educational expenses.
Start a new business or side hustle.

Invest in your personal development, such as taking courses or attending workshops.
Help your family and friends pay for essential expenses, such as food, housing, or medical care.
Donate to community organizations that are working to help those affected by the pandemic.

No matter what you choose to use your COVID-19 loan funds for, make sure that you have a clear plan in place. This will help you to get the most out of the money and ensure that it is used responsibly.

How to register a NIRSAL account

NIRSAL, which stands for Nigeria Incentive-Based Risk Sharing System for Agricultural Lending, is a credit risk guarantee scheme set up by the Central Bank of Nigeria (CBN) to encourage banks to lend to eligible agricultural enterprises.

To register for a NIRSAL account, you will need to visit the NIRSAL website and create a profile. Once you have created a profile, you will need to provide the following information:

Your name
Your email address
Your phone number
Your business name
Your business type
Your business location
Your business website (if applicable)

Once you have provided this information, you will need to submit your application. NIRSAL will then review your application and approve you for an account if you meet the eligibility criteria.

Once your account is approved, you will be able to access the NIRSAL portal, where you can view your account information and apply for loans.

Here is a step-by-step guide on how to register for a NIRSAL account:

Visit the NIRSAL website: https://nmfb.com.ng/
Click on the “Register” button in the top right corner of the page.
Enter your name, email address, and phone number.
Click on the “Create Account” button.
You will receive an email with a verification link. Click on the link to verify your account.
Once your account is verified, you will be able to log in to the NIRSAL portal.
To register your business, click on the “My Business” tab.
Click on the “Register Business” button.
Enter your business name, type, location, and website (if applicable).
Click on the “Submit” button.
NIRSAL will review your application and approve you for an account if you meet the eligibility criteria.
Once your account is approved, you will be able to apply for loans.

Tips for registering for a NIRSAL account

Make sure to provide accurate information when registering for your account.
Verify your email address as soon as possible.
Complete your business profile in full.
Make sure to upload all required documents.
Review your application carefully before submitting it.

If you have any questions or problems registering for a NIRSAL account, you can contact NIRSAL customer support at https://nmfb.com.ng/contact-us.

How to Check NIRSAL Loan Status

If you’re a Nigerian business owner or individual who has applied for a loan from the Nigeria Incentive-Based Risk Sharing System for Agricultural Lending (NIRSAL), you’re probably wondering how to check your loan status.

Here are a few ways to do it:

1. Online

The easiest way to check your NIRSAL loan status is online. You can do this by visiting the NIRSAL Microfinance Bank (NMFB) website and entering your BVN or account number.

Once you’ve entered your information, you’ll be able to see your loan status, as well as your loan repayment schedule and other important information.

2. By phone

You can also check your NIRSAL loan status by phone by calling the NMFB customer service line at 0700-647-2562.

When you call, you’ll be asked to provide your BVN or account number. Once you’ve provided your information, a customer service representative will be able to tell you your loan status.

3. In person

If you prefer to check your NIRSAL loan status in person, you can visit any NMFB branch.

When you visit a branch, you’ll be asked to provide your BVN or account number. Once you’ve provided your information, a bank representative will be able to tell you your loan status.

Conclusion

To conclude, applying for a COVID-19 loan in Nigeria is a relatively straightforward process. However, it is important to do your research and choose a lender that is reputable and offers favorable terms. With careful planning and preparation, you can increase your chances of success and secure the funding you need to get through this difficult time.

Please share this blog post with your friends and family so more people can benefit from this information. I hope this blog post has been helpful. If you have any questions or feedback, please don’t hesitate to leave a comment below. I will do my best to respond to each and every one.

Thank you for reading!

How to apply for covid-19 loan in nigeria