Polaris Bank — how to get an SME business loan or financing

With the help of Polaris Bank — your business can get the valuable funds it needs.

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Polaris Bank is a commercial bank — based in Nigeria.

The bank has its headquarters in Victoria Island, Lagos state. It operates over 350 bank branches — spread throughout the country.

Polaris Bank offers numerous different finance products and services — appropriate for both big and small businesses.

Funding and types of business loans available through Polaris Bank

Project Finance

Through its project financing offerings, Polaris Bank can cater to the needs of large companies — that need funds to develop infrastructure or industrial projects.

Structure Finance

Polaris Bank offers structured finance solutions — that are perfect for businesses with very unique financing needs.

Term Loan

These are loans that have tenors of between 12 and 36 months. The actual term of any approved loan, is based on your business’s specific requirements. The repayment structures are flexible. This facility is suitable for a variety of things such as executing capital projects, or funding the acquisition of fixed assets.

Time Loan

Time loans are shorter-term loans, with tenors of less than a year. Repayment structures can be tailored to your needs.

Overdraft Facility

For companies looking for a safety net, to help manage any fluctuations in cash flow or to respond to emergencies, a business overdraft should be considered. Here, Polaris Bank extends credit that allows you to overdraw your account — subject to an approved overdraft limit. This facility is commonly given for a 365-day tenor, and interest is applied to any monies borrowed.

Long Term Finance

This facility is designed to help with long-term financing needs for instance — business capacity expansion. The facility can be structured in the form of a finance lease — where Polaris Bank acquires an asset on your behalf, and you make monthly lease payments.

Bonds & Guarantees

Polaris Bank’s bond and guarantee products can increase your credibility and attractiveness — as a business or trading partner. For example, a bank guarantee can confirm your creditworthiness or your ability to meet any contractual obligations.

Trade Finance

Polaris offers a mix of different trade finance products. These are particularly useful for importers, exporters and trading companies. Products offered include import financing, invoice discounting, bills for collection, letters of credit and more.

Value Chain Banking

Through its value chain banking offerings, Polaris Bank offers a number of mainly short-term credit facilities. Products offered include distributor finance, supplier finance, and receivables financing.

SME Loans

Polaris has several products on offer — geared towards small and medium-sized enterprises (SMEs). Examples of such products include market, health sector and school advantage loans. Depending on the specific facility, up to N100 million can be borrowed and interest rates are as low as 5%.

Intervention Funds

The Government of Nigeria, through various related organizations like the Bank of Industry (BOI) and the Central Bank of Nigeria (CBN), has made available several funds to support the growth of SMEs in the country. Examples of such funds, that Polaris can help you access, include Micro, Small and Medium Enterprises Development Fund (MSMEDF), BOI MSME Loan and Agri-Business Small and Medium Enterprises Investment Scheme (AGSMEIS).

Qualifying for a Polaris Bank business loan

In order to qualify for a Polaris Bank business loan, a number of qualifying criteria must be met.

The specific lending requirements of each finance product differ. However, there are some requirements that apply across the board.

Examples of such general requirements include having a profitable business and having a good credit history. Without these two factors, it would be difficult to get a loan with not just Polaris — but any bank in Nigeria.

Where you are able to offer some form of collateral — credit history will be slightly less important.

Further lending criteria may include:

  • Having a registered business or company — with the Corporate Affairs Commission (CAC)
  • 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

Polaris Bank business loans and other types of business funding, are only reserved for registered companies. In other words, if your business is not registered with the CAC, or you are applying as an individual, business financing will be out of reach.

Personal loans and salary advances, which Polaris does offer, can be another way to get valuable funds for your business.

Another option is to apply for a loan through SukFin — who can provide you with a host of other options.

How to apply for a Polaris Bank business loan

After having done some research, into the Polaris products on offer, you will be ready to apply for a loan. If you need further information, before applying, you are always welcome to try phoning or emailing Polaris directly.

Loan applications are usually made by visiting your nearest Polaris Bank branch. There you would meet with a loan adviser, and be asked to fill in an application form. This application form will ask for various details of both your business, and any directors you have.

Key information to be provided includes details of your company’s trading history, its financial standing and the purpose of the loan. Polaris Bank will use your completed application form, together with any publicly available information, to make an informed lending decision.

An offer letter will be issued — if your loan application is successful.

Some basic documentation that can be asked for, as part of any application, 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, voters card)
  • Proof of address
  • Details of collateral offered (if any)

Note. Depending on the credit facility sought — Polaris Bank may ask you for more (or less) documents.

Frequently asked questions (FAQs)

How long will it take before receiving funds from Polaris Bank?

Loan application processes and disbursement timelines vary. When loan amounts are small, and borrowing is based on an unsecured basis — funds can be advanced relatively quickly.

How long do I have to pay back a Polaris Bank loan?

Polaris can lend to you both on a short and long-term basis. Repayment plans are also structured according to your needs.

How much can I borrow from Polaris Bank?

Polaris Bank lends to both SMEs and larger corporate organizations. Accordingly, the amount of money that can be borrowed — is only limited by your business’s capacity to make repayments.

What is the interest rate charged on a Polaris Bank loan?

Polaris Bank has competitive interest rates. With some products, the applicable interest rates are single-digit.

Does Polaris Bank require collateral?

If your business does not require much money, Polaris may be able to lend to you on an unsecured basis. Businesses that need relatively large amounts of money, will typically only be offered a secured loan i.e. a loan with collateral.

Acceptable forms of collateral or security 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)

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