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11 Top Sources of Funding For Your Business in Nigeria

Businesses in Nigeria need operational funds to survive. Businesses thrive with funds and stagnate without funds. Although there is a paucity of funds everywhere, startups in Nigeria can still access business funds if they know where to look. These 11 top sources of funding for your business in Nigeria will enable you to raise business capital with ease.

It must be pointed out that millions of Nigerian youths and aspiring entrepreneurs remain stuck with their viable ideas due to a lack of business capital. Ideas cannot fly without funds; and businesses cannot launch in the absence of money. If you have viable business ideas and need credible intel on how to raise business finance, then this detailed article resource is for you.

11 Top Sources of Funding For Your Business in Nigeria

Top Sources of Business Funding in Nigeria

As an aspiring entrepreneur in Nigeria, here are 11 top sources of funding for your business. These sources of business funding are not limited to Nigeria; they can also be explored in other African countries and throughout the world. These funding sources are not limited by time and space; they work for anyone who is intent on succeeding as a newbie entrepreneur within and outside the country.

1. Loan 

One of the fastest and easiest ways to secure business funding in Nigeria is through loans. You can obtain business loans from commercial banks and online lenders. You can secure bigger loan amounts from commercial banks for 5-10 years with lower interest rates, but you will be required to provide collateral – vehicles, buildings, and land. 

A commercial bank can provide between N5 million and N30 million in business loans within 1-3 days after fulfilling all loan requirements. However, online lenders may not require any collateral and they can get your loan approved within minutes, but they have a significantly higher interest rate and shorter loan tenure. They can give up to N2 million for 6-12 months.

There are hundreds of online lenders you can use, but the most popular are:

– Carbon

– Fairmoney

– Branch

– Palmcredit 

2. Personal Savings

Depending on the type of business you are setting up, your personal savings may be all you need to launch your startup. Your savings may be from a portion of your salary, a monetary gift, a share dividend, or other income sources. If you have a sizeable egg nest, you can use it to set up your new business without bothering about loans.

Depending on your desired startup, N500,000 may be sufficient to start your business; and you may also require up to N2 million if you want to have all your bases covered. However, it is best to start small and scale up from there. Even if you have huge savings, you may want to start small and inject more funds as the business scales.

3. Family and Friends

When the chips are down, family and friends can always come to your rescue. Since friends and family believe more in you, they will be inclined to raise funds for your business needs if you are launching a startup. Family and friends could raise an interest-free loan for you, and they could also contribute money to enable you to kickstart your new business.

Family members and friends are not only there to make donations for you, but they can also be the first customers to build credibility for your business. After patronizing you, they can leave positive testimonials for you and also refer more customers to you. When thinking of business capital, ask your family and friends first before considering other likely sources.

4. Inheritance

Did you just come into an inheritance after the demise of your grandparents, parents, uncles, or some loved ones? Your inheritance may be money in the bank, real estate, vehicles, or business entities among others; you can invest part of your new property into your new business as capital. 

However, it is important to consult with financial and inheritance experts before investing a significant portion of your inheritance into your new business. This is to safeguard your investment and ensure that your inheritance is not wasted or lost to mismanagement. You may need to consult or hire investment experts to handle things for you.

5. Personal incomes

You can raise capital for your business from personal sources such as salaries, book and music royalties, and lottery winnings. If you earn salaries from two or three jobs, you can use the salary from a major source to fund your business without taking out a loan. If you earn more than you spend, then it is reasonable to fund a startup with personal incomes from several side-hustles you run.

This means you can raise money from existing businesses or side-hustles to meet your new business needs. The more ventures, consultancy, public speaking, and commercial enterprises you can harness, the more personal incomes you can utilize to establish your startup.

6. Property sales

Do you have property or assets that can be converted to cash? If you have land or buildings that can be sold for cash, unused furniture or abandoned vehicles, as well as artefact such as figurines, statues, pottery, or craft – you can sell these off to raise business funds. Any saleable property that is abandoned, disused, and partly damaged can be sold to raise capital.

It must be emphasized that only disused, partly damaged, and abandoned property should be considered for disposal. Furniture in the garage that is gathering dust, a malfunctioned and abandoned vehicle that you rarely use, or heirlooms such as artefacts that can be auctioned at high prices – these can be used to raise business capital for your startup or to expand an existing business.

See Also: 17 Ways to Plug Financial Leakages & Save Money in Your Business

7. Partnership

If you do not have sufficient capital to go into a new business in Nigeria, you can enter into a partnership with fellow entrepreneurs. All partners in the business must pool financial and material resources together to float the business. Depending on the partnership agreement, some partners can provide the entire capital while others provide expertise, time and energy, industry contacts and networking, and market logistics among others.

It is important to go into partnership with people you trust, and with partners who bring something tangible to the table. Their contribution to the business may determine their rewards and official positions in the business. But everything must be spelt out in the partnership contract, including liquidation and takeover of partners’ stocks.

8. Crowdfunding 

Crowdfunding involves getting many people to donate to your business startup or personal causes. It is usually done online where you post your needs and what you need the funds for – and then people who are convinced about your needs make donations to your cause – free money that is not repaid.

If you are in Nigeria, you can use NaijaFund to crowdfund your business for takeoff; but if you are outside Nigeria, you can use GoFundMe, Kickstarter, MicroVentures, and Indiegogo among others to raise business capital, secure investors, or obtain potential customers for your new startup.

9. Startup Grants

Apart from crowdfunding where you get free funding for your business, you can also obtain free money to expand an existing business in Nigeria. With government grants, you can access startup grants to kickstart or expand your business with minimal bottlenecks in the country. You are often required to have a viable business, a viable business plan, and be eligible before applying for business grants.

Here are some of the sources of business grants that you can become eligible for in Nigeria:

– Tony Elumelu Entrepreneurship Programme (TEEP)

– Youth Entrepreneurship Support (YES) Programme of the Bank of Industry (BOI)

– GroFin Fund

– Africa’s Young Entrepreneurs Empowerment Nigeria Financial Grants

– Lagos State Employment Trust Fund (LSETF)

– Africa Women Development Funds (AWDF)

– YouWin Connect Nigeria

– Africa’s Business Heroes (ABH) of the Jack Ma Foundation

– Orange Corners Lagos, run by FATE Foundation and funded by the Embassy of Netherlands in Lagos

– Diamond Bank BET Programme

– Shell LiveWire, funded by The Shell Petroleum Development Company of Nigeria Limited (SPDC) 

10. Angel/Private Investors

Angel or private investors are people who commit funds to your business for financial returns. They are financial partners who make significant investments into your business after you have agreed to pay them a portion of the profits. You can obtain angel investors in your community or online at Indiegogo.

Although angel or private investors are partners in your business, they do not engage in the day-to-day running of the enterprise. They commit operational funds and then sit back to watch you make a profit; although you can always consult them for relevant help when you need it for business growth. Sometimes, angel investors are even people who wish to remain anonymous.

11. Pre-orders

You can raise business capital through pre-orders for your startup. What this means is that you can begin to sell your products and services long before they are available to customers. Do you know that some publishing companies pay authors huge royalties ahead of accepting their books for publication? It is also possible to collect payments from customers for new products before a company manufactures the goods.

If you can advertise your startup and potential products on Indiegogo and in traditional media, interested customers can make payments that can be used to launch your business far ahead of production. With pre-selling or pre-orders, a business will raise payments from customers before the products they paid for are manufactured and delivered. You can raise business capital this way.

Further Tips to Help Your Fundraising Drive

With the above 11 top sources of funding for your business, you are guaranteed of raising the required capital for your next startup. The journey to raising your business capital may be long and torturous, but with effective planning and professional guidance, you can obtain whatever funds you require within 1-3 months, depending on the scale of your next startup.

In some cases, you might be required to have a detailed business plan before people will invest in your business. Some banks will require a business plan, and some investors will also require business plans that outline every aspect of your proposed project. The business plan will cover the type of business, regulatory registrations, anticipated employees, estimated operational capital, estimated sales turnover, and estimated profits among others.

Before and after the launch of your business, it is important to consult professionals such as tax experts, financial consultants, sales gurus, and legal specialists to guide you through various business terrains. Do not forget that you must obtain all local, state, and federal permits and authorizations before your business kicks off so as not to run foul of government regulations.


This resource covers the A-Z of raising business funds for your next startup. The top sources of business capital covered in this piece include:

  • Bank loans
  • Personal savings
  • Family and friends
  • Inheritance
  • Partnership 
  • Crowdfunding
  • Startup grants
  • Angel/private investors
  • Personal incomes
  • Property sales

It must be noted that raising business capital for a new venture might take 1-3 months and the need to draw up a detailed business plan. You may face a few rejections at the initial stage of prospecting for business funding, but you must exercise patience and dedication until you succeed. You may even need to pitch some investors before you get them on your side.

If you are pitching new investors, ensure you understand the type of business they love to invest in before approaching them. It might be helpful to have your business plan and legal permits handy before you pitch to them. Having all official documentation ready indicates to prospective investors that you are serious about your startup, and that it is worth their investment.

Another factor that would work in your favour is to demonstrate to banks, potential investors, family, and friends, as well as organizations giving business grants that you have the expertise to succeed at your proposed business. Academic qualifications, professional certifications, industry experience, and industry contacts are some of the factors that must back up your fundraising drive to succeed in your endeavours.