Q. Who are the target markets for cooperative loans?
A. Tier 1 – Cooperatives of major oil companies
Tier 2 - Cooperatives of
a. Other oil companies
b. Other multinationals (manufacturing, telecommunications etc.)
c. Federal Institutions
Tier 3 – Cooperatives of
a. Less structured private sector companies
b. Private and public sector organizations
c. Schools
d. State and local government institutions
Q. How do they qualify?
A. The Cooperative must:
a. Be registered
b. Have bye laws duly endorsed by the state director/registrar of Cooperatives
c. The bye laws must state that the cooperatives may borrow from a financial institution
d. Not have returned cheque in the six months preceding the application
e. Provide a bank statement for at least 12 months preceding the application.
f. Have a positive CRMS report
g. Must give details of borrowing history
h. Have a membership strength not less than 50 members
i. Have a minimum age 3 years
j. Have an aggregated monthly contribution of N600,000 and above for Tier I & II
k. For Tier III cooperatives; have an aggregate member’s monthly contribution between N320,000 and N600,000.00
The Cooperative can use up to 50% of its monthly contributions for loan repayments
Q. Which cooperatives are outside our target market?
A. Our target does not include un-incorporated cooperatives or those set up for commercial purposes e.g. market women, taxi owners, farmers’ cooperatives etc. because they have a different source of income and risk profile
Q. How do they pay?
A. Monthly deductions are made from the current account that the co-operative has with us
Q. who decides what each member is entitled to?
A. The cooperative is left to decide how the money is disbursed amongst its members
Q. What is the obligor limit?
A. Tier 1
• Maximum =N=50 million Minimum =N=3 million
Tier 2
• Maximum =N=50 million Minimum =N=3 million
Tier 3
• Maximum =N=20 million Minimum =N= 3 million
Subject to 50% of its monthly contributions for loan repayment
Q. What kind of loan do we offer?
A. Land Acquisition Loan
Q. To what purpose can the funds be used?
A. The facility is for the purchase of a large portion of land with one title
Q. What properties qualify under the Coop lending?
A. Land purchase is restricted to the urban areas of following places:
- Lagos
- Port Harcourt
- Abuja
- Enugu
- Calabar
Q. Can properties be purchased outside the above listed cities?
A. yes, but only application for properties in G.R.A and gated estates shall be accepted.
Q. what is the required security/support?
A.
• The property stands as the collateral and a legal mortgage will be taken on it
• Irrevocable domiciliation of proceeds with Oceanic bank until the loan is liquidated or
• Acknowledgement of the irrevocable direct debit mandate on the account of the cooperative with its main bankers until the loan is liquidated.
• Evidence of the cooperatives instruction to the parent body (duly acknowledged) to domicile contribution with their main bankers
• Cooperate guarantee of the parent body (Tier ll & III)
Q. What is the tenor of the facility?
A. 3 – 60 months
Q. Do they need to contribute any money?
A. yes, 20% of property value
Q. Are we willing to finance existing facilities
A. Yes as long as the cooperative qualifies and provides a letter from the current financial institution stating indebtedness and an undertaking to release collateral documents upon receipt of payment been provided.
