Who is offering Online Loans in Nigeria?
Online loan providers in Nigeria have become a key way for people and businesses to get easy access to capital. Most banks, mortgage lenders and microfinance banks already offer online information material as well as printable online application forms. In parallel many innovative loan companies are entering the market that provide Nigerians with online loans.
Locating a loan provider in Nigeria
You can also locate loan providers on Loan Search, our lender review lists helps borrowers to identify the provider most suited to their needs. Whilst their free loan search engine carries the details of hundreds of different loans, big and small, short term and long term, so you can be sure to find the best interest rate deal for you.
What is a personal loan?
Personal loans, also known as unsecured loans, are where you borrow a fixed amount from a lender, and agree to pay it back over a set time period paying fixed monthly repayments.
The lender will charge you interest as its fee to lend money to you, so you repay both the amount you borrowed plus interest. The advantage is that you get cash upfront, but are able to spread the cost of a purchase over several months or years.
This guide tells you the cheapest personal loans, but also addresses whether other finance options might be cheaper for you.
Types of Online Loans in Nigeria
The types of loans offered in Nigeria differ from one another by the terms of the loans.
Learning the differences between the various types of loans can help you evaluate your lending needs and weigh your options—you’ll have a better understanding of which loan will best suit your needs and how to evaluate the terms offered by various lenders. There are many different types of consumer loans. Some of the most common include
- Secured loan: This type of loan requires an asset to secure the loan. If the borrower defaults on the loan, the lender has a right to take the collateral. Secured loans are commonly used when buying a vehicle. With a secured loan, the lender will insist on some sort of security against the money you borrow, often a house or car. If you default on the payments, the bank or building society can then sell the asset to clear the debt.
You can usually borrow large amounts with a secured loan, and at a lower rate of interest. Plus, you can pay back the debt over a long time period, perhaps ten or 15 years.
However, secured loans are more risky than unsecured loans because you could lose your collateral if you cannot clear the debt. You should therefore think very carefully – and consider other options – before taking out a secured loan.
- Unsecured loan: There is no collateral required on an unsecured loan, thus the interest rates are normally higher than for an unsecured loan due to the higher risk to the lender. An unsecured loan, often referred to as a personal loan, is not secured against any asset. Of course, you still have to pay the money back and the lender could pursue you into court if necessary to get its money back. But you don’t have to put up your house or car as collateral.