# 3 Microfinance Banks That Offers Loans without Collateral



## Innovictor (Jan 27, 2015)

In a post that was published yesterday, I talked about 3 Nigerian banks that can give you loans without asking for collateral. You can find the post here, if you'd like information on those banks. However, it turns out that non-collateral loans from banks are not designed to be utilized by all classes of business.

For one, you might need to borrow a relatively small amount of money "say N50,000" and it might be sheer wickedness to ask you to open a corporate bank account and manage the account for 3 months before you apply for a N50,000 loan. In addition, you might need to access the cash urgently and the bank's typical processing time might just be too long for you.

Hence, this post is written for you, if you need access to business (and occasionally personal) non-collateral loans, without having to go through the typical bank hassle. I hope you find it informative as you raise funding to build a successful SME in Nigeria.

*The Advent of Microfinance Banks*

Prior to 2005, most Micro Small and Medium Scale Enterprises MSMEs in Nigeria were practically unserved and underserved financially when it comes to raising business credit. For one, they borrow small amounts and traditional banks consider them high-risk debtors.

Hence, most MSMEs had to rely on thrifts, cooperative societies and moneylenders among others to raise business funding. However, the fact that the government did not regulate these thrift cooperative societies meant that Nigerian MSMEs were mostly at their mercies.

Hence, the government through the Central Bank of Nigeria organized the Microfinance Policy Framework of 2005 to assist micro-entrepreneurs have better access to business credit. This piece is by no means an exhaustive piece on Microfinance Banks that offers loans without collateral, but it offers a starting pointy to get you in the right direction.

*LAPO Microfinance Bank Limited*

LAPO (Lift Above Poverty Organization) runs a microfinance bank that is aimed at assisting the Nigerian micro-entrepreneur obtain access to credit, savings instruments and other financial services. The major advantage of obtaining loans from LAPO is that the repayment plan is in small installments. In addition, transaction costs are minimal, collateral is not required and you don't need to fill up a mountain of paperwork.

To obtain credit from LAPO, you'll be required to fill a registration form, open an account with 10% of the amount you intend to borrow, get two guarantors who will be visited by a LAPO liaison officer. The repayment plan for the typical LAPO loan is up to tenure of 8 months, an interest rate of 2.2% and a 1% monthly contribution of the loan that will be available to you for withdrawal when you repay the loan.

*AB Microfinance Bank Nigeria*

AB Microfinance Bank Nigeria makes it easy for Nigerian entrepreneurs to obtain loans in a quick, transparent and efficient environment. The major benefit of obtaining loans from AB Microfinance is that you can obtain up to N1.5 million in loans from its Maxiplus loan plans.

To obtain loans from AB Microfinance, you don't need to provide a mandatory deposit/savings account; in fact, you need not provide audited financial statements. Depending on the size of the loan, the repayment plan can run from 5 to 18 months, but you should be prepared to pay interests of up to 6% on declining balance.

*Mainstreet Bank Microfinance Bank Ltd*

Mainstreet Bank Micro Finance Bank (MFB) is child-company of Mainstreet Bank and it is licensed by the Central Bank of Nigeria to provide Nigerians with micro-financial services. Since starting operations in 2009, Mainstreet MFB has given out more than N1.3 billion in loans and the average loan per customer stands at about N257,000.

To obtain loans from Mainstreet MFB, you'll need to visit the bank's office at 94, Broad Street, Lagos or make inquiries at the closest Mainstreet Bank. Alternatively, you can call: 234--01-2137072, 234--01-2137079 or email [email protected] for more information.


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## Samuel Arua (Jun 3, 2017)

wow! but the condition may include having a paid job and interest rate maybe something else. anyway, it is still good for borrowers who are serious to do a business through which they can return the loan.


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## Victor adeyefa (Oct 10, 2018)

Innovictor said:


> In a post that was published yesterday, I talked about 3 Nigerian banks that can give you loans without asking for collateral. You can find the post here, if you'd like information on those banks. However, it turns out that non-collateral loans from banks are not designed to be utilized by all classes of business.
> 
> For one, you might need to borrow a relatively small amount of money "say N50,000" and it might be sheer wickedness to ask you to open a corporate bank account and manage the account for 3 months before you apply for a N50,000 loan. In addition, you might need to access the cash urgently and the bank's typical processing time might just be too long for you.
> 
> ...


Its possible for me t


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## exceeding (Mar 28, 2019)

i want to apply


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## Jude berry (Oct 4, 2019)

I want a loan, can I apply online from the listed microfinance bank above? 
If so put me through.


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