NIRSAL Loan Application Tips For SMEs

NIRSAL Loan Application Tips For SMEs

November 26, 2020 0

Following the outbreak of the coronavirus pandemic, several households and MSMEs were adversely affected. Global supply chains were greatly disrupted, leading to severe consequences on households’ livelihood and business activities. 

To manage this crisis, the Central Bank of Nigeria (CBN) introduced the N50 billion Targeted Credit Facility (TCF). This credit facility’s sole purpose is to provide a stimulus package to cater to the needs of households and MSMEs affected by the pandemic.

NIRSAL Loan Application Tips For SMEs
Why worry when you can get a loan from NIRSAL?

Objectives of the TCF

  1. Curtail the adverse effect of coronavirus pandemic on MSMEs in Nigeria.
  2. Provide necessary support for MSMEs and households that have had their activities disrupted by the pandemic.
  3. Provide MSMEs with credit facilities to expand their productive capacity.

The Targeted Credit Facility scheme will be funded by the Micro, Small, and Medium Enterprises Development Fund (MSMEDF). The eligible financial institution for this fund’s disbursement is NIRSAL (Nigeria Incentive-Based Risk Sharing System for Agricultural Lending) Microfinance Bank.

What Is NIRSAL About?

NIRSAL is a holistic and dynamic approach that addresses the agricultural financing value chain and agricultural value chain issues. Its responsibilities include:

  1. Fixing the agricultural value chain to enable banks to lend to the sector confidently.
  2. Encourage lending to the agricultural value chain by offering banks technical assistance and strong incentive.

While previous schemes do not provide banks with a clear strategy for lending, NIRSAL focuses on lending to the value chain and different producers’ sizes.

Eligible Participants/Activities For The NIRSAL Loan

As an SME in Nigeria looking to benefit from this loan, you must be aware of all eligibility criteria stated by the Central Bank of Nigeria (CBN).


  1. Households that have been adversely affected by the COVID-19 pandemic and with verifiable evidence.
  2. An existing enterprise with verifiable evidence of business activities. Also, it must have been adversely affected by the COVID-19 pandemic.
  3. Enterprises possessing bankable plans to make use of the opportunities provided by the pandemic outbreak.


  1. Hospitality – Accommodation and food services
  2. Manufacturing
  3. Health
  4. Trading
  5. Airline service providers
  6. Any other activity generating income as determined by the Central Bank.

Accessing The NIRSAL Loan

Two modalities are considered when applying for the NIRSAL loan for SMEs in Nigeria. According to CBN’s circular issued on March 23rd, 2020, the modalities involve either the Corporate entities or the Households/MSMEs.

Corporate Entity

  1. A corporate entity is required to submit an application to NIRSAL Microfinance Bank – NFMB. This application will include evidence of the opportunity or adverse impact as a result of the COVID-19 pandemic.
  2. NFMB shall appraise and conduct due diligence applications.
  3. Upon successful appraisal of the application, NFMB will forward it to the CBN for final approval.
  4. Applications are reviewed by CBN, followed by final approval for the disbursement to NFMB.


  1. Eligible MSMEs and households are to submit their applications to NMFB – NIRSAL Microfinance Bank.
  2. Alongside applications, applicants must also submit other things like BVN number, business plan, and business registration. Also, clear evidence of the opportunity or adverse impact as a result of the COVID-19 pandemic.
  3. Following application appraisal, successful applications will be forwarded to the CBN for final approval.
  4. Applications are reviewed by CBN, followed by final approval for the disbursement to NFMB.

General Requirements to Access Loans from NIRSAL Microfinance Bank

Before any entity can apply for the loan, they must provide the following documents:

  1. A letter of employment
  2. A payment slip
  3. Staff identification card
  4. Statement of account for at least six months
  5. Valid forms of identification such as International passport and National Identity card
  6. Utility bill
  7. Employment letter
  8. Two passport photographs
  9. Guarantor form

Collateral Requirement For The NIRSAL Loan

Any beneficiary of the loan is to provide collateral as is acceptable by the Microfinance bank. Collateral requirements include any one of more of the following documents:

  • Moveable assets that are registered on the NCR (National Collateral Registry).
  • A deposit of title documents that are in a good state.
  • A deed of stocks debenture in a perfect state.
  • Irrevocable domiciliation of proceeds.
  • Two acceptable guarantors.
  • Life Insurance of the Key-Man, with NMFB, noted as the First Loss Payee.
  • Comprehensive insurance over the asset.

Loan Limit 

The amount of loan made available differs based on business types. The limit set for each eligible body includes:


Loan amount for SMEs is determined by the applicant’s cash flow, activity, and industry size. SMEs are eligible to access a maximum of N25 million.


Households have a maximum loan amount of N3 million.


The Targeted Credit Facility Scheme by the Central Bank of Nigeria is a great move to bring back stability to Nigeria’s economic and household activities. Through this funding, there is still much hope for businesses that have crashed due to the coronavirus pandemic.

However, households and SMEs in Nigeria looking to take advantage of this fund have between now and December 31st, 2024. Before this exit date as stipulated by the Central Bank of Nigeria, the framework will undergo review from time to time as deemed fit by the CBN.

Alara Charis
Alara Charis
Alara Charis
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