LAPO (Lift Above Poverty Organization) established in 1987, is an NGO in Nigeria that runs a micro-finance bank (MFB); which is one of the Nigerian banks that give out loans without collateral. The LAPO Microfinance Bank Limited is a pro-poor financial institution committed to improving the quality of life of the poor through the provision of credit, savings instruments and other financial services.
If you are still wondering if it is really possible to borrow money without collateral in Nigeria, well, it is for REAL. Someone very close to me here in Nigeria was recently granted a business loan by LAPO without collateral. So, in this post, I will be sharing with you where you can get the loan to start a small scale business, the benefits, the requirements and the repayment plan.
Benefits of becoming a LAPO client
- Small amount of installment, therefore making repayment schedule least stressful.
- Transactions cost minimal, banking services to the door step of clients
- Low cost of service
- No collateral is needed
- No extensive documentary work needed
- Benefit from diversified clients training programme.
Requirements for LAPO Trader's Loan
==> Open account with 10% of the amount you want to get as loan.
==> Two Guarantors (Note: They will be visited by LAPO laison officer). Your two guarantors must be on ground on the day the loan will be disbursed to you.
==> LAPO laison officer will also visit your shop to assess it.(Note: This will play a vital role in how much the trader will get because they are going to assess the shop).
After the above processes, you can then pay 10% and 0.5% of the approved loan amount for administrative fee and Insurance premium respectively and you will also be trained for two days.
LAPO Loan Repayment Plan and Interest Rate
Apart from taking the this loan without collateral, you are also going to enjoy a very small interest rate that is very affordable. The loan is been given out with an interest rate of 2.2% only as at the time of publishing this post and the repayment is up to 8 months.
Mind you, 1% of the loan will be contributed by you monthly and you can withdraw the total after you finish paying back the loan.
Let's quickly do small mathematics.
Take for example: If you get a loan of N150,000 from LAPO, remember the interest rate is 2.2% and you decide to pay it back in 6 months.
Total Interest for 6 months = 150,000 x 2.2% x 6 months = 19,800.
Monthly loan payment = (19,800 + 150,000) / 6 = 28,300
Monthly contribution = 1% x 150, 000 = 1,500
Therefore, Total monthly payment = 28,300 + 1,500 = 29,800
In conclusion, if you take a loan of N150,000, you will have to pay N29,800 monthly for 6 months.
Just to wrap it up, only collect the LAPO loan amount that you can afford to pay back without stress.
You have to follow your repayment plan religiously because you will be fined if you don't pay back at the right time, the fine should be around N1,500 daily till you pay.
Please don't divert the loan to use it for online investments especially HYIP.
LAPO has over 300 branches in Nigeria. LAPO helps in improving lives and committed to the empowerment of low-income individuals. You can check LAPO website at : http://www.lapo-nigeria.org.
I hope you make the best of this post. Feel free to ask questions via comments.
Written By Jide Ogunsanya on July 20, 2013
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