The United Bank for Africa (UBA) has been a lender engaging businesses and individuals in managing projects by financing and securing viable partnerships that have produced returns one way or the other. Reports by DAVID AGBA.
Drivers of economic growth
Globally, banks are known to be engines of economic growth. They mobilize funds from surplus areas to areas of need, give interest to depositors and charge interest to borrowers, thereby providing income to those who have idle funds and deriving income from those who borrow money to finance their businesses.
In doing so, capital gaps that may exist for companies undertaking significant transitions in their operations are eliminated.
The long-standing need to strengthen capital structures and reduce reliance on borrowing has become more urgent as many companies are forced to increase their leverage to survive the recent economic and financial crisis. Indeed, the problem of SME over-indebtedness may have been exacerbated by policy responses to the crisis, which have tended to focus on mechanisms for firms to increase their indebtedness (e.g. direct loans, loans).
While bank financing will continue to be crucial for the SME sector, there is widespread concern that credit constraints are simply becoming “the new normal” for SMEs and entrepreneurs. It is therefore necessary to widen the range of financing instruments available to SMEs and entrepreneurs, in order to allow them to continue to play their role in investment, growth, innovation and employment.
Undoubtedly, all the potential to ensure the expansion of entrepreneurs can be seen from the performance of SMEs.
Small and medium-sized enterprises (SMEs) are considered essential segments of successful economies. Nigeria was no exception as the economy slipped into recession for the second time in four years as oil prices plunged amid the COVID-19 pandemic. While bank financing will continue to be crucial for the SME sector, there is widespread concern that credit constraints are simply becoming “the new normal” for SMEs and entrepreneurs.
Need for more financing instruments
To guard against this event, experts called on financial institutions to expand the range of financing instruments available to SMEs and entrepreneurs. This, they said, would allow them to continue to play their role in investment, growth, innovation and jobs.
During the turbulent economic situation where businesses have suffered from the brunt of COVID, insecurity and other economic challenges, a few banks have come clean and served as an adequate lifeline for businesses helping the economy overcome its challenges. economic.
Access to credit has therefore become very important, especially in times of crisis, exacerbated by the COVID-19 pandemic, with economies around the world hard hit.
One of the noteworthy banks is United Bank for Africa. The bank has been innovative enough to help businesses in Nigeria and across Africa weather the storm with several lending facilities that have helped change the narrative and ultimately catalyze growth.
First among others
Top performers in corporate lending in the first quarter of the year include United Bank for Africa (UBA) Plc, Access Bank Plc, FBN Holdings Plc, FCMB Holdings Plc, Fidelity Bank Plc, Stanbic IBTC Holdings Plc and Wema Bank Plc . . It should be noted that UBA has done well to weigh business firmly in 20 African countries, which has gone a long way in keeping them afloat in a turbulent time occasioned by COVID 19 and inflation from the Ukraine/Russia war. .
Commenting on credit to customers by banks, a financial expert and stockbroker, Mr. David Adonri of Highcap Securities Limited, said that businesses need short-term credit to finance their working capital.
“Banks are the source of this type of financing. Due to risk management considerations, bankability of applications is a major factor in credit creation. Of course, banks will generally observe the canons of lending when extending credit. If the economic environment is conducive and the outlook is bright, confidence to extend credit to borrowers will be high as repayment is guaranteed,” he said.
Speaking on the bank’s recent lending stance and its consequent determination to buy up the country’s SME sector, group chief executive Oliver Alawuba said: “Our passion for small businesses and big ideas is not has never been in doubt and manifests itself in the strong support given to individuals and because our loan products are specially designed to meet the varied needs of all our customers.
Speaking on the bank’s strategy, he said, “Our core strategy will continue to focus on providing excellent service from the perspective of our customers, always putting the customer first. Looking ahead, I am inspired by the achievements we have made since the launch of our transformation program. We have significantly expanded our market share in the geographies where we operate and are consolidating our digital banking leadership in Africa. We will continue to leverage our diverse business model and dedicated workforce to further strengthen our position as “Africa’s World Bank”.
Many loan products
While giving an overview of the bank’s range of lending products that are changing the dynamics of the industry, Head of Consumer Lending Group, Anant Rao, recently spoke about some of the products and the inherent benefits for customers, as he said Senior loan is designed to support retirees between the ages of 55 and 70. they can get up to 10 million naira to start a retirement plan, travel the world and do so much more and repay easily within 36 months.
As for Personal loans, Rao said, “This is a product designed to help fund the day-to-day needs of our customers. Available to employees whose salaries and other emoluments are paid through UBA or who wish to transfer their accounts to UBA.
The bank has listed the required documents like an introduction and sensitization letter from the employer, a copy of the client’s staff ID, a copy of a client’s valid ID, an invoice pro forma on behalf of UBA/client and a completed loan application form and accepted letter of offer.
UBA Mortgage Loan
The UBA Mortgage Loan is a product intended to partially finance the acquisition of residential property by employees whose employers are on the bank’s list of approved counterparties.
“The product is aimed at High Net Worth Individuals (HNI) with a predictable and sustainable income. The product is to allow customers to purchase fully developed properties or withdraw equity from their homes in the form of loans for specific purposes,” the bank said.
The UBA Personal Loan – Direct is a variation of the UBA Personal Loan product for civil servants whose salaries are not domiciled with UBA. The product is designed to offer personal loans to civil servants who find it difficult to transfer their salary accounts from other banks to UBA.
This loan is available to federal civil servants registered on the IPPIS platform, state civil servants (this will be limited to states whose salaries are managed by an ICT company). The required documents include the completed loan application form, a copy of the client’s staff ID, a copy of the client’s valid ID, and the client’s instruction letter.
UBA FX Cash Backed Loan
UBA FX Cash Backed Loan is a term loan designed for Nigerians residing in Nigeria or overseas who have a funded domiciliary account with the bank. Clients can obtain up to N10 million for investment purposes or to meet the financial needs of loved ones in Nigeria. Required documents include; Funded domiciliary account, Completed loan application form, Valid means of identification (international passport, national driver’s license, national identity card and voter registration card
Also UBA working capital loan offers up to N50 million to help business owners meet their cash flow needs and grow their business. Flexible collateral coverage will be required depending on the amount of the loan and the nature of the client’s business.
This loan product is intended for clients with verifiable net credit worth whose cash flow patterns meet loan requirements and other structured groups/business groups
There is also UBA Asset Finance for SMEs, UBA School Loans and UBA Health Loan.
“This is a medium to long term facility to meet the working capital, asset and mortgage needs of registered private schools. The package includes a four-month term loan, a three-year asset finance loan and a 10-year mortgage.
Another variety of loan offers specially designed to meet the needs of different people also includes Car loans where customers can obtain up to N15 million for partial financing of new vehicles for customers whose salaries are domiciled with the Bank. Vehicles purchased will be in the name of UBA/customer name. and they are available for all car models at selected dealerships nationwide. The The required documents are as follows; Letter of introduction and sensitization from employer, copy of client’s staff ID, copy of client’s valid ID, pro forma invoice in the name of UBA/client, completed loan application and accepted letter of offer.
With a UBA credit card, customers are free to spend up to N3 million and have the option to pay interest as low as 0% when repaying within 45 days. UBA customers can withdraw cash both locally and internationally, make online bill payments, shop, book hotels, and enjoy amazing discounts at partner restaurants and hotels, lounge access, and more. . worldwide.