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How to apply for CBN loan for Nigerian graduates/undergraduates

How do I apply for a CBN loan for Nigerian graduates/undergraduates and grant? I have explained it all in this article.

It is no longer news that the Central Bank of Nigeria introduced a Tertiary Institutions Entrepreneurship Scheme (TIES).

The CBN loan for Nigerian graduates scheme provides a platform for university and polytechnic undergraduates and graduates who are willing to set up businesses access to loans.

The apex bank’s aim is to address rising youth unemployment and underemployment among undergraduates and graduates of Nigerian polytechnics and universities, so they stop seeking white-collar jobs and become entrepreneurs.

The CBN loan ranges from N5 million for individual/sole proprietorship/small company projects to N25 million for partnerships/company projects.

Businesses are expected to start paying back after 12 months and repayment should be completed in five years.

How to apply for CBN loan for Nigerian graduates

The Term Loan Component consists of two tires for individuals and companies

Tier 1/ Individual projects

The maximum loan amount in this category is N5.0 million, with a 5-year repayment period. The current interest rate on the loan is 5% per year, however, it will increase to 9% on March 1, 2022. In addition, the loan has a maximum 12-month moratorium on principal and interest.

Documentation/Collateral Requirements:

  • The applicant shall apply as a business entity registered with the Corporate Affairs Commission (CAC) and certified true copies (CTC) of relevant forms submitted
  • Bank Verification Number (BVN)
  • First-degree certificate (BSc/HND or its equivalent)
  • National Youth Service Certificate (NYSC) discharge or exemption certificate and
  • Certificate of Participation issued by polytechnics and universities evidencing entrepreneurship training

Collateral Requirements

  • Duly signed Global Standing Instruction (GSI) and
  • Third-party guarantee from a senior federal/state civil or public servant (not below level 10 and not having less than 5 years to retire from service), clergy of note and reputation or recognized traditional ruler.

Tier 2 – Partnership/Company projects

Company projects loan limit is N25.0 million, with a 5-year term. Interest rate is 5% per year, however, it will climb to 9% on March 1, 2022. Also, the loan has a maximum 12-month principal and interest moratorium.

Documentation/Collateral Requirements

The partnership or company shall apply as a registered business with the Corporate Affairs Commission (CAC) and certified true copies (CTC) of relevant forms submitted.

  • EACH member of the partnership or company shall also submit:
  • Bank Verification Number (BVN)
  • First-degree certificate (BSc/HND or its equivalent)
  • National Youth Service Certificate (NYSC) discharge or exemption certificate
  • Certificate of Participation issued by polytechnics and universities evidencing entrepreneurship training.

Collateral Requirements

  • Duly signed Global Standing Instruction (GSI) by a member of the partnership or company and
  • Third-party guarantee from a senior federal/state civil or public servant (not below level 10 and not having less than 5 years to retire from service), clergy of note and reputation or recognized traditional ruler.

Award of Grants (CBN loan for Nigerian graduates)

Five top Nigerian polytechnics and universities with the best entrepreneurial pitches/ideas shall be awarded as follows:

  • First place – N150.0 million
  • Second place – N120.0 million
  • Third place – N100.0 million
  • Fourth place – N80.0 million and
  • Fifth place – N50.0 million

The grants shall be in the following areas:

  • Agribusiness
  • Information technology
  • Creative industry
  • Science and technology

Any other activity as may be determined by the CBN from time to time.

The Scheme shall be operated for a period of 10 years in the first instance (not exceeding 31st December 2031) depending on the complexity of the project.

Interested person can apply online via the designated online portal  providing requisite information and documents, such as:

Female entrepreneurs are encouraged to apply and are expected to take up to 50 per cent of the offers.

Existing businesses can also be qualified for funding through equity investment.

The bank said that it will also distribute N500 million among the top five tertiary institutions under the national biennial entrepreneurship competition to raise awareness and visibility of entrepreneurial or technological innovations among undergraduates.

How undergraduates can apply

Undergraduates would be able to apply for grants through the scheme’s development component.

In a national biennial entrepreneurship competition, the Developmental Component would be distributed in the form of awards to Nigerian polytechnics and universities.

The competition aims to increase undergraduates’ awareness and visibility of high-impact entrepreneurial/technological concepts, foster entrepreneurial talent hunts in Nigerian polytechnics and universities, and encourage commercially viable and transformative technologies.

Interested Nigerian polytechnics and universities shall apply to participate in the national biennial entrepreneurship competition on a dedicated online portal (https://cbnties.com.ng), outlining brief details of the project, potential impact and evidence of originality of project;

How CBN TIES Loan works for undergraduates

CBN would choose a Body of Experts (BoE) from the corporate and governmental sectors to assess entrepreneurial and technology innovations submitted.

The BoE will review the submitted applications through engagements that feature undergraduates competing by pitching entrepreneurial and technology innovations at regional levels, with finalists progressing to the national event for final consideration and ranking by the BoE.

Applications shall be through submission on https://cbnties.com.ng

The showcasing programs will be shown on channels such as social media and national television stations for four weeks to assist showcase the benefits of entrepreneurship and influence attitudes and social perceptions about it.

On the recommendation of the BoE, the grant will be awarded to the top five entrepreneurial and technological innovations at the national level; and the grant will be disbursed in 55:45 ratio tranches directly to a dedicated account opened for the grant by Nigerian polytechnics and universities, subject to approved milestones.

Eligibility for TIES CBN loan

  • Only Nigerian polytechnic or university degrees will be considered.
  • If you have the documents listed below then you are good to go:
  • First-degree certificate (BSc/HND/ or its equivalent)
  • National Youth Service Certificate (NYSC) discharge or exemption certificate
  • Certificate of Participation issued by polytechnics and universities evidencing entrepreneurship training and
  • Not more than 7 years post-NYSC

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