Baobab loans at a glance
Baobab loan packages are location-based financial services that are for individuals with businesses in specified locations. With only five eligible locations (Oyo, Ogun, Lagos, Abuja, and Kaduna), Baobab loans focus on helping micro, medium, and small businesses drive growth through convenient financing.
Some Baobab loan advantages are:
- Interest rates reduce as you pay back your loan
- Loans can be accessed without a domiciled account in the bank
- Special Taka Loans for Baobab clients, with zero interest rate and processing fees; lending limit increases upon prompt payment (less than 15 days) starting from an initial maximum of ₦150,000
These advantages, as with most outfits, come with some drawbacks, some of which are:
- Confusing loan terms, specifications, and requirements
- Location-specific; you can only access the loans if you are in some parts of Nigeria
- Need for guarantors; you cannot access Baobab loans without credible and acceptable guarantors
Do I qualify for a Baobab loan?
To qualify, you must have a business that has been in existence for at least six months. This business must also have a healthy flow of income with an acceptable credit history and must be located in Lagos, Abuja, Kaduna, Abuja, or Oyo in Nigeria.
You must also:
- Not be younger than 22 years or older than 58 years
- Have been paying your utility bill (as this will be part of the required documents) for at least three months consecutively
- Have two credible and acceptable guarantors
- Bank Verification Number
You can qualify for a loan even if you are a student, trader, or entrepreneur; as long as you fall within the specified criteria and you have an acceptable income from your business.
How to apply for a Baobab loan?
Baobab loans cannot be automatically applied for like most other loans. You must have been approved by Baobab that you are fit to obtain a loan before you can apply for any of the available packages. This means that you have to visit the Baobab loan website to fill out a loan request form, and then a representative will contact you to inform you if you can obtain a loan or not.
After you have been selected and have applied, you then have to wait for a service representative to get back to you and refer you to the nearest branch. Visit the branch with your valid identification card and other necessary documents to access your loan.
Other necessary documents include:
- Valid Corporate Affairs Commission Documents
- Valid Identification card
- Recent photographs
- Phone number
- Business activity
How much can I borrow from Baobab?
The minimum amount an individual can borrow from Baobab Microfinance bank is ₦20,000, while the maximum is ₦50,000,000. The specific amount that you can borrow depends on many factors, including your personal details, credit history, and most especially, the type of loan package you wish to obtain.
Your loan will be processed and disbursed within three days if approved.
Baobab Interest rate and loan tenure
The interest rates on Baobab loans differ from package to package, but what never changes is that the interest rate does not go below 7%. On each loan, Baobab charges a commission of 2.5% to 5% depending on the loan amount.
For the Baobab Taka loan, you can borrow up to ₦150,000 for a maximum of 2 weeks to 1 month with no interest rate or processing fees. This loan is, however, only accessible to Baobab clients.

Baobab loan tenures officially claim to range from one month to two years. This is inaccurate as all their loans carry a minimum tenure of 6 months and a maximum tenure ranging between 18 and 24 months.
Other loan fees and penalties
There is a ₦4,000 fee you have to pay upfront to access Baobab loans. When your loan has been disbursed to you, you must keep 10% of the loan in your Baobab account for a specified period. You will also be barred from accessing some loan packages, like the Baobab Taka loan, if you do not pay back on time.
Benefits of Baobab loan
One of the most popular benefits of Baobab loans is that interest rates on loan packages are charged with a “reducing balance system”. This just means that as you pay back your loan on time, the interest slightly decreases. This incentive should always be compared with other rates and not just automatically accepted because it reduces.
The reducing balance system, alongside a convenient repayment plan, ensures that lenders are indirectly incentivized to pay on time and that they can pay back comfortably.

Where Baobab can still improve
Baobab loans have a lot of confusing and almost conflicting terms. It almost feels as if the information is deliberately not straightforward to confuse consumers. A lot of improvement will be achieved if the conflicting information is cleared up and precise details are provided for their specified loan packages.
Baobab loan packages can sometimes be rigid in terms of location application and repayment terms. When compared to other loan outfits, this is a huge disadvantage and it can be overcome by making loans available to individuals who are not from the specified states and by giving customers full control of the loans that have been approved for them.
Baobab loan packages are great for customers who have the patience to go through the rigorous selection, application, and confirmation processes. Even though you can borrow money without having a Baobab account, you are better off having the account because of the stress it saves and the advantages it provides when it comes to obtaining loans. The wait, however, will be worth it as the specific selection criteria allow Baobab to focus on the customers it deems fit to obtain loans.
Frequently Asked Questions (FAQ)
How can I get a loan of ₦50k from Baobab Loan?
You can get a loan of ₦50,000 from Baobab Microfinance Bank by qualifying and applying for a loan; to qualify, you must have a business that has been in existence for an acceptable period. A check will be made to your business account to determine if you’re edible to borrow the ₦50,000 or not.
Do I need to have an existing account with Baobab Microfinance Bank to access a loan?
No. An account will be opened for you where your loan will be paid if it is approved. It is from this account that you will access your loan amount, and 10% of the loan must be left in the account at specific times.
What can make my Baobab loan application get rejected?
A bad credit history will prevent you from getting a Baobab loan. Your business has a bad credit history if you have debts and you have not been paying previously collected loans on time.
How do I make a complaint about a loan to Baobab?
Call +234 070 0022 6222, or send a mail to [email protected] If you would like to physically lodge your complaint instead, visit their branches at 360 Murtala Muhammed Way, Yaba, in Lagos, or 16E Ahmadu Bello Way, CB Finance House in Kaduna. Balboa loan teams are available from 8:30 am – 5:30 pm on Monday to Friday and 10 am to 3 pm on Saturday.
Do I need to have collateral to apply for a Baobab loan?
You do not need collateral to apply for a Baobab loan, but you do need to have other forms of assurance that you will pay back your loan. Baobab loans require you to be able to provide two trustworthy guarantors who will stand in place for you. In the case that you are unable to pay back your loan at the agreed time, these guarantors will have to take responsibility for the payment.