Which Loan Provides Interest Subsidy in Nigeria Year 2023?

Paydayloanskentucky.orgWhich loan provides interest subsidy? Obtaining a loan does not always mean a solution. Sometimes it can end up in a disaster. If you weren’t able to pay it back on time, it would create an issue.

Ironically, a sizable portion of the population has a tendency to experience such a thing. Students and farmers are some of the examples. They need money for their studies and work but can not provide assets or stable incomes to get a loan.

That’s why the government offers a variety of options to assist both of them. The subsidized loan is one of the options they can choose.

In this article, we will cover all the information about subsidized loans. However, we’ll first talk the distinction between a subsidized vs an unsubsidized loan.

Which Loan Provides Interest Subsidy for student

Subsidized Loan vs Unsubsidized

The definition of a subsidized loan is not that complicated. As the name implies, it is a type of loan in which the lenders do not demand the full interest from the debtors.

Sometimes, the lenders don’t ask for interest at all or, in other words, it’s 0%. That’s why people keep asking about which loan provides interest subsidy in Nigeria.

The purpose of a subsidized loan is to help the unfortunate population. On the other hand, an unsubsidized loan is just a common type of loan. The debtors have to pay the full interest by themselves. But they are not bound to certain conditions.

Which Loan Provides Interest Subsidy Backed by Federal Government?

Each country always has a program for giving subsidized loans to its people. As explained before, the program is usually supported by government institutions.

There are at least several institutions in Nigeria that are well-known for this type of loan. The first one is the CBN or Central Bank of Nigeria.

This bank is supported by the Federal Government. Along with the CBN, the Federal Government also gives special funds through SMEDAN, the Bank of Agriculture, the Bank of Industry, and others.

Central Bank of Nigeria Loan 2023

The Central Bank has released several programs that will help entrepreneurs and farmers. As of 2023, some of these programs are:

  1. Agricultural Credit
  2. Fund for all scales of enterprises
  3. Creative Industry Loan

These programs can be categorized as subsidized loans because the interest rate is low. Other than that, it also has a longer repayment duration.

Which Loan Provides Interest Subsidy for Students?

While it’s more limited, students have several subsidized loan choices. First, they can apply for a special loan through the CBN website. Another choice is to get help from the universities’ special allocation. The government always gives each university a special fund.

There’s currently a plan for establishing a Nigerian Education Bank or NEB. The bank must have the authority to approve or deny loans. They will also be in charge of monitoring and managing student loans. However, it will undoubtedly take some time before being built.

Which Loan Provides Interest Subsidy for Farmers?

Farmers can also receive a special loan from the government. The CBN, for instance, has its own product called Agri Credit. The interest rate is as low as 8% per annum.

Aside from the central bank, agricultural workers and landowners can also apply for subsidized loans from the Bank of Agriculture and the Bank of Industry.

The first one has more agricultural credits. One of their programs is a special fund for youth farmers called YARN.

The YARN is definitely an interesting agricultural credit. It’s also revolutionary in its purpose. It targets the young population . The purpose is to attract them to be farmers.

In 2022, Nigeria ranked 103rd in the Global Hunger Index. Part of the reason is the poor performance of the agricultural sector. When the educated young population enter this sector, the country hopes they can boost their productivity.

Nirsal Agric Loan (NAL)

Nirsal Agric Loan or NAL is an agricultural credit from the Nirsal. This product is well-known as it has helped farmers across the country for years. The successful applicants for this loan will receive agricultural funding from the government.

Nirsal provides loans as low as N50,000 and as much as N250,000,000. The interest rate is definitely very competitive compared to other loans.

Which Loan Provides Interest Subsidy for Entrepreneurs?

Lastly, aside from farmers and students, entrepreneurs can also get a subsidized loan. The government is supportive of them as they want the country to develop more.

The CBN, in particular, has its own program for business owners. Aside from that, those looking to start or expand their business can get a loan from NEXIM and SMEDAN.

NEXIM is a perfect choice for those who work in the export and import business. It has products like an export facility development fund. On the other hand, SMEDAN offers various businesses’ funds, such as the automotive business loan. They also have special products for young entrepreneurs in Nigeria.

NoDemographicsSubsidized Loans
1StudentsSpecial loan from the Federal Government through the CBN
2FarmersAgri credit from CBN, Nirsal Agric Loan, Agricultural credit from BOA
3EntrepreneursEntrepreneur loan from CBN, NEXIM, and SMEDAN

In the end, it can be said that there are several options to get subsidized loans. For those asking about which loan provides interest subsidy, it is better to be specific first. The reason is that there are different types of loans for different debtors.

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