The Requirements for a Personal loan in Nigeria 

Requirements for a Personal loan in Nigeria


The requirements for a personal loan involves meeting specific requirements to prevent fraud and ensure only qualified individuals access these loans.

Key requirements include a Bank Verification Number (BVN) for security and credit assessment, proof of identity for fraud prevention and compliance with financial directives, proof of income to determine repayment capacity and loan terms, utility bills to verify residential addresses and estimate financial capabilities, and an acceptable credit history to gauge creditworthiness and default risk.

Additionally, the minimum legal age for borrowers is typically 18-25 years. Some lenders may also require collateral, domiciled accounts, minimum salary or income levels, specific location, absence of debts, or business ownership for at least 6 months.

Requirements prevent unwanted entities from gaining access to vital facilities. Without these requirements, a lot of fraud and illegal activities can be carried out.

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Personal loans in Nigeria need these requirements to ensure that only appropriate and qualified individuals gain access to loan facilities.

General Requirements for Personal Loans in Nigeria

Personal loans in Nigeria have key requirements that borrowers need to meet before they can obtain them. These requirements include:

    • Bank Verification Number (BVN)

    • Proof of identity

    • Proof of income

    • Utility bills

    • Acceptable credit history

    • Legal Age

Bank Verification Number (BVN)

A Bank Verification Number is a unique number given to bank customers in Nigeria to secure and protect the banking transactions of that particular customer. This number, introduced in 2014 by the Central Bank of Nigeria, can be easily used to track the transactions of Nigerians to curb financial fraud.

Lenders in Nigeria require a BVN before they can process loans because:

    • The Central Bank of Nigeria has made the BVN a compulsory requirement

    • The BVN helps to easily and securely carry out transactions across multiple banks thereby making the loan application process easier

    • The BVN allows lenders to easily and quickly assess the credit histories of loan applicants, making it very easy to check their creditworthiness and determine if they can manage their loans or not

    • The BVN helps banks to streamline the loan process by easily confirming the identity of loan applicants

Generally, a Bank Verification Number helps lenders improve the security and efficiency of their loan application processes. By asking for BVNs, lenders are better equipped to serve the loan needs of customers.

Proof of identity

Lenders require proof of identity from loan applicants mainly to confirm that applicants are who they say they are to prevent fraud. Some of the details they require may include:

    • Name

    • Address

    • Phone number

    • Valid means of identification

    • Email address

These details are crucial and non-negotiable for banks when granting personal loans because providing them helps protect both the bank and the customer. Some of the reasons banks require proof of identity include:

    • In compliance with the Anti Money Laundering and Counter-Terrorism Finance directive from the Central Bank of Nigeria

    • For customer verification to prevent fraud

    • For customer protection to prevent identity theft

Providing proof of identity is in both the lender’s and borrower’s best interests as it ensures that the lender curbs fraud by being able to identify the borrower and that nobody else can use the borrower’s identity to commit fraud.

Proof of income

Lenders require proof of income from prospective borrowers majorly to determine if the borrower has the facilities to pay back the loan. Some of the commonly accepted proofs in Nigeria include:

    • Bank statements

    • Salary slips

    • Letter from employer or employment status

    • Tax returns

    • Proof of business ownership

Proof of source of income is a very important requirement as it allows lenders to understand the financial capabilities of borrowers to fully determine the risk involved in lending money. Some of the reasons lenders require proof of income include:

    • To accurately measure borrowers’ capacity to repay

    • To determine the loan package that can be offered to the borrower

    • To determine repayment capacity and interest rate that can be extended

Utility bills

Utility bills are majorly required to confirm the residential addresses of borrowers. Some of the accepted bills include;

    • Water bill

    • PHCN or electricity bill

    • Telephone bills

    • DSTV/GOTV or Cable receipts

    • Rent agreement

    • LAWMA bill

Lenders need to confirm the residential addresses of borrowers to:

    • Reduce the risk of lending money to individuals

    • Determine the residence in the case of default

    • Have an estimate of the borrower’s financial capabilities

    • Prevent fraud and identity theft

Utility bills are part of the important criterion when in loan requirements and they help lenders to effectively verify the risk levels associated with lending money while also using them to make informed decisions in other lending aspects.

Acceptable credit history

Lenders require the credit histories of borrowers majorly to effectively determine the terms and conditions of loan packages.

To understand all about what credit history is and how credit scores are determined and used, check here.

Acceptable credit history is usually a requirement because:

    • It helps determine the borrower’s ability to pay back the loan

    • Helps lenders understand the risk of default

    • Generally helps to determine creditworthiness

Good credit history is a very important requirement for loan applicants in Nigeria as it provides lenders with valuable information that helps determine the overall risk involved in giving out the loan.


The minimum legal age requirement for most lenders is 18 years in Nigeria. Some lenders however may choose to set this age between 18 and 25.

Age is a vital requirement because:

    • It is used to determine the financial experience of the applicant which can help lenders make informed decisions

    • it can determine if a cosigner or collateral is required to secure a loan

Generally, a potential borrower’s age is important as it serves as a factor that helps to determine creditworthiness and ability to repay loans. It is used to effectively understand the risk associated with lending and mitigate default rates.

Other uncommon requirements

A handful of lenders might demand extra requirements that are not common alongside the general requirements. Some of these may include:

    • Collateral

    • Domiciled accounts

    • Minimum salary for employees or minimum stream of income

    • Location

    • Zero debts

    • Business ownership (6 months)


Loans with collateral as a requirement are called secure loans. These loans usually have lower interest rates as the lenders are taking fewer risks since they can possess the collateral in the case of default.

Some lenders however make collateral a mandatory requirement for loan applications.

Domiciled account

A requirement for some lenders is that a borrower has or opens an account with the lender to receive the loan payments. This means that the borrower can only utilize the funds from an account of the lender’s choosing.

Some lenders may additionally require that the domiciled account must have been active for a period ranging from 6 to 12 months. This means that only current customers with verifiable account histories can request loans.

Minimum salary for employees or minimum stream of income

Lenders need to see evidence that a borrower can repay the loan and this evidence is sometimes shown in how much you earn. This is why some lenders require a minimum salary from employees and a minimum stream of income from business owners before they can be considered for loan packages.


Some loans in Nigeria are location specific. This means that you have to live and operate in certain locations before you can apply for a loan from that lender.

Zero debts

Some lenders require borrowers to have no existing debts as a requirement for loan applications.

Business ownership

Some lenders specifically create loan packages for business owners in Nigeria. These lenders will require proof of ownership and income flow of the businesses for a period between 6 and 12 months to show that the business is legit and can meet repayment requirements.

Alternative requirements for personal loans in Nigeria

It is possible that a borrower does not meet up with the requirements to obtain a personal loan in Nigeria. In this case, there are lenders, such as microfinance banks and peer-to-peer lenders, who have very flexible requirements which can be considered as alternatives.

These requirements vary widely depending on the lender and the borrower’s relationship with them. A few include:

    • Any available collateral

    • Group membership

    • Business plan

    • Guarantor

Any available collateral

Some lenders may allow borrowers without a stable source of income to declare any available collateral in exchange for a suitable loan package. This is not usually possible with standard financial institutions as only suitable properties are used as collateral.

Group membership

Some lenders may use social contacts in case a borrower cannot meet up with the standard requirements. As long as the borrower is a recognized member of a popular societal group, they may qualify for loans.  Other lenders lend solely to members of such groups, therefore being a member is the only requirement to access such loans.

Business plan

Some lenders, like microfinance entities, might be flexible to lend to borrowers with solid and achievable business plans. This might be possible after rigorous checks and after the lender is sure that the risk is worth taking.


Some lenders may be flexible enough to grant loans as long as someone credible can stand in as guarantor for the borrower. This ensures that the lenders get paid by a known and capable guarantor if the borrower cannot pay.

Frequently Asked Questions

Do I need collateral to get a personal loan in Nigeria?

No. You can access unsecured personal loans as they do not require collateral. Secured personal loans, however, require you to have collateral before you can be eligible to obtain them.

How important is my Bank Verification Number?

Without a Bank Verification Number (BVN) you cannot access loans from legitimate lenders in Nigeria.

Is it compulsory to have a domiciliary account to get a personal loan in Nigeria?

A domiciliary account is not one of the requirements for obtaining a personal loan in Nigeria. Some lenders, however, require you to have a domiciled account. A domiciled account with a lender means that your money will be sent to an account opened by and with the lender for you.

Can I get a loan for my self-employed business?

Yes. There are many personal loans available for individuals who are self-employed in Nigeria.

I am below 18 years of age, can I get a personal loan?

Most legitimate lenders require you to be between 18 years and 60 years to be eligible for a loan. It is however possible for a guardian to obtain a loan on your behalf if you are below 18 years of age.

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