BOI Loan Minimum Turnover for Startups

The Bank of Industry (BOI) is Nigeria’s leading development finance institution. It was established to aid the development of small and medium-sized enterprises (SMEs) as well as startups along with industrial and commercial projects. For business owners and entrepreneurs who are new owners, one of the most frequent concerns is whether there is a minimum turnover required prior to applying for the BOI loan.

This guide provides everything you should be aware of regarding BOI loan turnover requirements and eligibility for new businesses and how businesses that are new may still be eligible despite not having an impressive turnover record.

Does BOI Have a Minimum Turnover Requirement?

The Bank of Industry does not have a set maximum turnover limit for start-ups. Instead, it evaluates each candidate based on their company’s type, size, financing category, repayment capacity, and growth potential.

Simply put, you may still be eligible for a BOI loan even if the startup is relatively new or only has a low turnover insofar as your business model is feasible as well as your projections demonstrate the capacity to generate revenue in the future.

However, the significance of turnover comes into play in determining

The size of the loan you qualify for.
Your repayment capacity.
Whether your business fits under the micro, small, or medium enterprise category.

How Turnover Affects Loan Eligibility

While BOI doesn’t have an exact turnover benchmark, it does use turnover as an economic indicator. Here’s how it can affect your application:

For micro-businesses and startups that have a turnover less than N5 million per year. BOI concentrates on your potential for business as well as realistic forecasts.
For small-sized enterprises the turnover typically ranges from N5 million to N50 million annually. The applicants have access to larger funds.
For medium-sized enterprises the turnover could be higher than N50 million per year, which allows higher loan ceilings as well as longer-term financing.

Startups with a small or no turnover are allowed to participate in BOI’s micro- and startup-related funding programs in the event that they show an enticing concept, market opportunity, and repayment plan.

Categories of BOI Loans and Implied Turnover Expectations

The Bank of Industry has different financing categories, each matched with the size of a business’s operation and capacity.

1.Micro-Business Loans

It was designed specifically for artisans, small-scale traders, and even startups.
Turnover expectations: Less than N5 million per year.
The loan range is N50,000 up to N10 million.
Concentrates on groups or individuals that have a proven business relationship.

2.Small Enterprise Loans

For small-sized businesses registered with small staff and operation.
Estimated turnover: N5 million to N50 million a year.
The loan range is N10 million to N100 million.
The loan requires only a small amount of financial and collateral.

3.Medium and Large Enterprise Loans

For companies that have an established operation and greater scale.
Turnover expectations: Above N50 million per year.
Loan amount: N100 million and over.
Audited accounts are required, as well as collateral, as well as evidence of the viability of the project.

How Startups Can Qualify Without Large Turnover

If you’re a startup and haven’t generated substantial revenue, you could still be considered a startup if you meet the following requirements:

A valid business registration You have to be registered through the Corporate Affairs Commission (CAC).
business plan or proposal—Give a concise plan of exactly how your loan is going to be utilized and the way it will generate income.
Finance Projection Instead of displaying turnover statistics, present the projected cash flow for the 12-24 months.
Evidence that there is a market demand You can provide evidence like orders, contracts, or even letters of intention to demonstrate that your service or product is popular.
Equity Contribution—BOI might require a modest contribution (typically 10-25 percent) as a share in this project.
Security or Collateral—Based on the type of loan, you might be required to secure either collateral or a guarantor.
A good credit standing Your BVN and financial report must not include outstanding loans that have not been paid.

Required Documents for BOI Loan Application

To boost your chances of being successful, you must prepare the following documents prior to applying:

Certificate of registration for business (CAC).
Business plan that includes projections of turnover.
Statement from the bank (6-12 months, if it is available).
A valid means of identification (NIN passport, NIN, or driver’s license).
Number for Tax Identification (optional, required for small- and micro-enterprises).
Proforma invoices or quotations of the proposed project (if you are purchasing equipment).
Collateral documents (if relevant).

Tips for Startups to Strengthen Their Application

Start by starting small. Request a lower amount of loan that’s in line with the size of your business and its capacity for repayment.
Display potential but not perfection: BOI values innovation and growth potential just as much as the history of turnover.
Transparent: Offer realistic estimates instead of inflated figures.
Learn from a mentor: Partner with a Business Development Service Provider (BDSP) for guidance—BOI recognizes BDSP-supported applications. BOI recognizes applications that are BDSP-supported.
Keep track of: Even minimal sales or expenses must be recorded to prove the activities.

Why BOI Emphasizes Turnover for Established Businesses

Turnover can help BOI determine the health of their financials and repayment capacity. For companies that are in existence, it serves as a measure of performance that shows:

Revenue trends over time.
Management of cash flow.
Operational coherence.
The rate of growth in business.

Although startups are evaluated differently, established companies need to demonstrate steady growth in order to qualify for more levels of funding.

Conclusion

The BOI has no minimum amount needed for start-ups to qualify for the BOI credit. What is important is the viability of the business, clear projections, and conformance to the eligibility and documentation requirements. Startups with creative concepts, valid registration, and realistic plans for growth may be considered for BOI’s micro and startup financing categories.

If your company is just beginning, you should focus on creating solid plans, keeping precise records, and proving the way your venture will generate profits. As time passes and your revenue grows, you’ll be eligible for bigger BOI facilities to grow your business even more.