We understand that when you hear the word loan, your mum or dad, friends, mentors, etc., must have strictly advised you to stay away from them unless you have a solid plan to pay back.
While that seems like good advice, they’re wrong regarding certain aspects of loans.
It’s as a proverb says, “An intense headache is not enough reason to cut off your head.” In essence, not all loans are bad or make you lose your collateral as they advertise in Nollywood movies.
You should indeed be wary of taking loans, but the kind of loans you should be wary of taking are short-term loans. The reason is, in a country like Nigeria, it’s not realistic to take an amount of money for two weeks.
Frankly, that’s not enough time to make money back. But loans like the federal ministry for youth and sport loans are long-term loans that require you to pay back what you owe with the space of three years with minimal interest.
Let’s find out what it’s about.
What Is The Federal Ministry For Youth And Sport Loan?
As a Nigerian youth who wasn’t born with a silver or golden spoon, running a business in the country can be frustrating.
While you’ll have to deal with the hassles of paying numerous taxes, you also need money to keep the business running smoothly. When you don’t have enough money to keep the business running, it can stress you out and mess with your mental health.
But guess what? You no longer have to go through the stress of funding your business alone as the Ministry of Youth and Sport in Nigeria has decided to create a funding program for youths in business.
This program is in partnership with the Nigeria Youth Investment fund to give out financial aid in loans to Nigerians who run businesses.
If this news catches your attention, we’ll tell you more about how to apply for it as you keep reading.
How Do You Apply?
For starters, you have to ensure that you qualify for the loan before you apply for it. You can go through the eligibility criteria in the latter part of this article.
Lucky for you, the application process doesn’t require you to go through the bureaucratic process.
Once you have a mobile device or mobile phone and access to an internet connection, you can apply for this loan from anywhere you are in the world.
- Log in on the Portal: If you’re sure that you’re eligible for the loan, proceed to the portal to apply for this loan. Click on the “Apply here” button and wait for it to take you to the form you need to fill out.
- Join the Training: After applying for the loan, you have to join the entrepreneurship training provided by the ministry. You’ll need to get approval from the Federal Ministry of Youth & Sports Development and also be faithful to attend all the scheduled training. So you’ll make the best use of this loan, this training would act as a guide of some sort for you.
- Apply for the Loan: Once you’ve completed the training, you can now apply for the loan. Proceed to the NIRSAL Microfinance Bank to apply. The ministry of youth and sports development is in partnership with the NMFB to disburse the loan amount individuals qualify for in the scheme.
- Loan offer: Now, this is the tricky part. Unlike other loans you might have applied for, the NMFB would deeply scrutinize your details and your personality through the information you provided. If they think you’re a high-risk individual, they won’t approve your loan application. Other factors could hinder them from approving your loan application, and we’ll address them in the eligibility criteria. Once you’ve been proven faithful via CBN, who would check your record, the loan offer would be disbursed into your bank account.
The Federal Ministry For Youth And Sport Loan Eligibility And Requirements
You’ll need to pay attention to this section as we highlight both the requirements and the criteria for the federal ministry for youth and sports loans.
Generally, most MSMEs are eligible for a loan under this scheme. Your business has to fall under the following categories to qualify for any loan amount under this scheme.
- Technology/ Innovation
- Green Economy and Renewable energy sector Creative sector
- Logistics and supply chain
- Agriculture and related value chain
- Healthcare value chain
- Hospitality/ Tourism
But to help the ministry shortlist eligible individuals, it was divided into two categories.
The first category addresses registered and unregistered businesses without a formal structure, while the second addresses registered and registered enterprises with a proper structure.
Eligibility Criteria For Unstructured Business
This category is specifically targeted at unstructured sole proprietorship or individual micro-businesses that are either registered or unregistered. To qualify for this loan, you’ll need the following;
- Valid Bank Verification Number (BVN)
- Operate an existing and functional business in Nigeria (registered or unregistered)
- You must be within the ages of 18-35 years of age.
- Local Government Indigene Certificate proves that you’re a Nigerian and an indigene.
- No financial crime record in the last 10 years.
Eligibility Criteria For Structured Business
If your business is registered and you have a small-scale to medium-scale business structure, you can get up to 3 million naira in the scheme.
Here are some of the requirements and eligibility criteria you must pass to apply for the loan.
- Valid Bank Verification Number (BVNs) of your Board of Directors if applicable
- Tax Identification Number (TIN)
- Summary of your Business Plan.
- Corporate Affairs Commission (CAC)
- Evidence of Training Certificate from approved FMYSD EDIs
Note that you won’t qualify for a loan under this scheme if you are a beneficiary of NMFB who hasn’t been paid.
Federal Ministry For Youth AND Sport Loan Repayment
Under this loan scheme, youths in business are entitled to 250,000 naira to 3 million naira. You’ll have to pay back the loan with a 5% pa interest, and it is spread over 5 years.