United Bank for Africa (UBA) is one of Africa’s leading financial services institutions — with operations in over 20 countries across the continent. UBA has over 70 years of experience in the banking industry. Today it provides a range of different services — cut across commercial banking, corporate banking, SME banking and retail banking. Together with Access Bank, First Bank, Guaranty Trust Bank and Zenith Bank — UBA forms part of Nigeria’s tier-1 banks. UBA has a variety of different business loan and finance products on offer — appropriate for both large corporates and smaller companies.
Funding and types of business loans available through United Bank for Africa
Young Entrepreneur Finance Scheme
Young Entrepreneur Finance Scheme is an initiative of the bank to provide credit facilities precisely to young entrepreneurs across Africa with energetic business ideas and who would require finance to grow their small and medium scale businesses. With this structure, UBA offers credit facilities to young African entrepreneurs. In order to apply, you need a durable and bankable business idea. Should you have this, UBA, along with other partner financial institutions, may be able to give you the capital needed to grow and scale your business.
This product seeks to offer credit facilities to young entrepreneurs across Africa with vibrant and bankable business ideas and who require capital to finance and grow their small and medium scale businesses. The source of the funding/guarantee shall be either directly from UBA or from any of the acceptable Development Finance Institutions (DFIs) such as USAID, IFC, AfDB, AFD etc., or other Hedge funds the Bank is able to work together with. All business sectors of young entrepreneurs with workable or thriving businesses ideas for strong potential growth except Real estate, Tobacco, Alcohol and Weapons.
The product is targeted at young entrepreneurs from across Africa who are at least 18 years’ old. A maximum of N15, 250,000 and a minimum of N1, 525,000. Maximum of 7years but startup businesses will be allowed a 6 months moratorium period. Applicant business must have been a customer for at least 1 month supported with 3 months’ account statement from former bank. Repayment will be made from beneficiary business proceeds irrevocably domiciled to UBA. You can apply for the young Entrepreneur Finance loan at UBA GROUP Click on YEFS and follow the heads-up.
UBA Medical Loan
UBA’s medical loan facility is designed to support businesses active in the healthcare sector. Funding can be provided in the form of a term loan, or by the way of asset financing. Examples of eligible businesses include dental clinics, diagnostic centers, hospitals, medical laboratories, opticians and pharmacies. Up to N50 million can be advanced, for up to 3 years.
With a temporary overdraft, businesses have access to extra cash — that can be used for emergency expenses. This is a short-term credit facility — where you can borrow funds for up to 30 days. Interest is charged on any monies borrowed.
Invoice Discounting Facility (IDF)
If your business often has unpaid invoices — you may be interested in UBA’s invoice discounting facility. Here, you can get a cash advance — as long as you have a verifiable invoice. Any money released, will be discounted i.e. you get a percentage of the total invoices value.
UBA School Loans
The UBA School Loans facility is aimed at meeting the funding requirements of private schools. Financing can be used for a variety of purposes including working capital, asset acquisition and buying/developing property.
UBA Creative Industry Finance
This creative industry scheme is backed by the Central Bank of Nigeria (CBN). With it, you can get a loan of up to N500 million, at an interest rate of 9% per annum. You will have up to 10 years to repay any monies borrowed. Businesses with activities in things like fashion, ICT, movies and music are eligible.
AGSMEIS stands for Agri-Business Small and Medium Enterprise Investment Scheme. It is an initiative designed by the CBN to support agricultural businesses — as well as other micro, small and medium-sized enterprises (MSMES). Up to N10 million can be borrowed, for 7 years, at an interest rate of 5% per annum.
Development Bank of Nigeria
Through participating banks like UBA, the Development Bank of Nigeria (DBN), advances credit to MSMEs — to be used to grow and develop their businesses. Depending on the nature of your business, you may have up to 10 years to repay the loan. Interest rates are flexible.
UBA links Nigerian importers, exporters and trading companies — to international markets — with the help of its trade finance solutions. Products on offer include letters of credit and LC discounting finance.
Qualifying for a United Bank for Africa business loan. UBA Bank has many different funding options — from term loans, to receivables finance, to business overdrafts. Further, there are a number of schemes or initiatives that focus on certain sub-sectors of the economy e.g. agriculture. Accordingly, your business may not necessarily be eligible to apply for every finance product on offer.
In addition, each of these facilities will have their own terms and conditions to meet. That being said, there are certain requirements you’ll need to meet — no matter the finance product that you apply for. In general terms, in order to qualify for financing, your business must show proof of regular monthly income. Having a profitable business and a good credit history is also important.
Other general business lending criteria can (but not always) include:
. Having a business or corporate bank account
. Been trading for some time (1-3 years minimum)
. Must have a good Credit Bureau Report — with no unpaid obligations or bad debt
. Being an active customer of the bank
Although you need a registered business, to apply for a UBA business loan, there are other options — for unregistered businesses.
UBA bank also offers personal loan products and salary advances, that may be used (in certain circumstances) for business purposes.
How to apply for a United Bank for Africa business loan
There are a few different methods for applying for a UBA business loan. Applications can be made via email, phone or in person (at a suitable UBA bank branch). Some loan products also accommodate online applications.
Irrespective of the channel of application, loan requests will be evaluated against UBA lending guidelines. Your business, as a whole, will be assessed and the purpose of the loan taken into account — before the bank reaches any lending decision.
- Funding approval will result in funds being released — subject to you meeting the terms set out in the relevant approval letter.
- A checklist of what may be required — as part of any application process includes:
- Completed application form
- Company profile
- Business plan
- Cash flow budget
- Bank statements (12 months)
- Audited financial accounts
- Certificate of Incorporation
- Valid means of identification (driving license, passport, and voter’s card)
- Proof of address
- Details of collateral offered (if any)
Note. More (or less) documentation may be asked for — depending on the credit facility you apply for and the size of your business. For instance, larger corporate organizations may need to produce a tax clearance receipt.
UBA requires collateral on some of its loan products, this is principally true — where large volumes of money are in question. For relatively small amounts of money — loose loans are possible. As soon as collateral or security is prerequisite, acceptable forms of such can include:
- Obligations of the Federal Government of Nigeria (FGN Bonds, FGN Eurobonds, FGN Treasury Bills etc.)
- Obligations of state governments or agencies of the Federal Government of Nigeria.
- Other non-government debt instruments
- Physical assets e.g. real property
- Third party guarantors (or collateral)