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Welcome to Naija Business And Entrepreneurship Ideas Headquarters! We have what you need to start a business of your own to make your life more abundant and fulfilling. We have business ideas covering several fields from education through agriculture to manufacturing with a specialty in Small and Medium Enterprises (SME) . Here, you won’t find anything about oil rigs because it is not our specialization. But if you have a few hundreds of thousands of Naira or a couple of millions to invest we will be useful. There are even zero capital ideas.

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Tag Archives: Loan proposal

Loan Proposal, How To Write One?

Loan Proposal, How To Write One?

A loan proposal should convince the banker that he will be able to get his money back just as he wants to know that a business proposal is profitable. A business proposal and loan proposal must be viable and feasible.
In a business proposal, you may not need to put in much accounting but you cannot escape accounting while writing a loan proposal. To write a loan proposal that will make the bank manager to put his green pen of approval you will need to incorparate the followings as the least for a small or medium business.

• Three Years Account of The Company
• Projected Cash Flow.
• Projected Cash Forecast.
• Projected Profit And Loss Account.
• Loan Repayment Plan.
• Calculation of Return on Investment (using ROI or NPV or other Method)
• Proposed Spending
• Analysis of expected revenue
• Analysis of staff cost.

These days, some banks may initiate loan processing even if you do not have an account with them with the proviso to switch account to them when your loan is approved. In that wise you will be required to present your current bank statements for 12 months.
See a sample here.
Besides the accounting, you will need to cover the followings.

• The Business itself.
• Profitability
• Management
• Staff.
• Marketing.
• The application.

Writing a loan proposal may be a bit daunting for some of us because of the accounting aspect.
Not to worry, if you are in need of one, talk to us. We won’t disappoint. We will handle it perfectly.
Contact Jide on 08034241050,

Water

Otunba Jide Omiyale

Otunba jide Omiyale
jidolconsul005@yahoo.com
Jidol Consul,
B4/B5 Lanre Shopping Complex,
New Ife Road

management

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A Simple Loan Proposal That worked.

A Simple Loan Proposal That worked.

Some people think writing a loan proposal is magic. No, it is not. Hereafter is one I wrote for a client and it worked. I apologize, I am not good at tables in word-press, however I am prepared to send a PDF format of the proposals if any of my reader request for it.

PROPOSAL

FOR XXXXXXXXXXXXX
XXXXXX ACADEMY

TO TAKE A N1.0M LOAN

FROM

XXXXXXXXXXX

By Jidol Consul,
B4/B5 Lanre Shopping Complex,
New Ife Road, Ibadan

APPLICATION
The Managing Director,
XXXXXXXXXXXXXX,
6,XXXXXXXXXXXXXX,
how to use monogram machine,,,,,,,,,,,\\mnn 14/7/13

APPLICATION FOR A FACILITY OF N1.0 MILLION
I am the proprietor of t xxxxxxxxxxxx Located along xxxxxxxxx Ibadan. I started the school in 1997 and I have invested on the land and building, fixture as well as the school buses. My total investment to date is estimated at about N10million.

Now that there has been a stable patronage for the past 3 years, it has become imperative that the facilities should be upgraded before the commencement of the 2013/2014 academic session and also to properly accommodate our JSS arm.

Apart from the steady increase in public registration, one or two schools located in the same vicinity are planning to move to their permanent sites and we are sure to be one of beneficiaries of the public that consider the permanent sites of these schools as far away because we are already on our permanent site. We believe our pupil population will go up to 250 in the next two years.

The upgrading of the existing facilities should be completed before the commencement of the next academic year in readiness for the increase. The upgrading project is expected to cost N1.5 and we required a medium term facility of N1.0M for 12months.

The repayment, interest and bank charges will be paid from the school fees as shown in the cash forecast. For the past three years, a maximum of sixty percent of fee was used for salary and other expenses to run the school.

With this proposed upgrading there will be more pupils and the running cost as a percentage of the fees will even reduce further.

Revenue & expenditure of Intelligent XXXXXXXXXX for the past three years
YEAR REVENUE EXPENDITURE
N’000 N’000
2010/22011 3500 210
2011/2012 4000 240
2012/2013 4500 270

I am submitting this report to you so as to appraise the project.
Our level of patronage in the last 5 years goes to confirm that we have acceptable academic and moral standards.

If the facility is approved, we have as security a landed property located at XXXXXXX area covered with a certificate of occupancy. A valuation report and photographs of property attracted.
We would implore you to please consider our application as soon as practicable in view of the fact that the project must be completed before the end of Aug 2013.

We thank you for your co-operation

Yours faithfully,

XXXXXXXXXXXXXXX

INTRODUCTION

The south western part of Nigeria is leading in the number of enrolment in schools in the country. This is because the average south westerner believes in qualitative education. Since 1956 when the free education program was introduced by the government led by the great Chief Obafemi Awolow, investment in qualitative education has been on the increase.

The general public in this geo-political area has complete confidence in competition and consequently a number of private individuals and groups introduced private Schools to complement government efforts. In Ibadan, a number of private Schools were established and carved out a fantastic reputation of educational excellence for themselves. A few of these schools are Maryhill Nursery Primary School and Baptist Nursery and Primary School.
These private Schools could not cope with the ever expanding demand and others with various degrees of efficiency sprang up.

With the ever increasing cost of transportation, parents started to look for schools in their catchment areas particularly when shuttling from their places of work to collect their children form school became a serious problem. After a careful analysis of the primary educations sub sector, XXXXXXXXXXX was established after seeking and obtaining the approval of Oyo State Government in 1997.

I, XXXXXXXXXX is the promoter of the school.

THE SCHOOL

XXXXXXXXXX Academy is located along XXXXXXXXXXX, directly facing the famous XxxxxxStop. The school serves the following communities Oyo State Housing Corporation’s Estate, Ojoo Military Barracks, Bashorun, Akobo Oju Irin, Omolayo area, General Gas area as well as Anifalaje area.

The population had hovered around 140 and hope it will increase appreciably with this proposed upgrading.

Year Pupil Population
2010/2011 140
20111/2012 135
2012/2013 138

Loan

Money, Invest It

The school has a total of 10 classrooms and a big hall which will be used for 5 classrooms. To these we hope to add another two to make a total of 17 classrooms. In addition, we have a school shop and conveniences.
Primary arm 10Rooms
Junior Secondary Arm 7Rooms
We also have two functioning two buses to cope with the expected increase in pupils to be ferried to school especially from Odogbo barracks.

The present facilities must be upgraded to some extent to complete effectively with two exiting reputable Schools in the same area. Our mission is to provide superior services to the parents and pupils and consequently we have decided to upgrade our facilities before the commencement of the next academic session in September 2013.

MANAGEMENT AND STAFF PROFILE
The management of any organization may make or mar it. The management team of XXXXXXX is made up of men and women who have passion for teaching. The management structure is organized as indicated below.

Chairman

Vice Chairman.

Head Of Academy

Asst. HA Sec Asst HA pry Head Operations

Teachers Teachers Cleaners Security

Chairman. The Chairman heads the management team. The Vice Chairman who will be nonexecutive reports directly to the chairman. The Head of Academy reports to the chairman, why his assistants who head each arm of the academy and head of operations report to him.
A short profile of the management team is provided below:

XXXXXXXX is the proprietor of the school. He possesses the following academic and professional qualifications:
Higher National Diploma in Applied Chemistry
Masters in Business Administration
An Associate of the British Institute of Marketing
A Fellow of the Nigerian Institute of Marketing

He taught for 6 years with the School of Chemical Technology, Zaria. He later moved to the private sector to work with the Michelin Group where he held various management positions before leaving to set up XXXXXXX his consultancy outfit.

Vice Chairman.The vice chairman is Mr. Xxxxxxxx. (B.Sc., ACA). He is a Chartered Accountant and a Banker. He is a nonexecutive vice chairman. His role is to advise on Financial Engineering matters and make sure the accounts are clean and the Academy remains focused. Should anything make the chairman not able to function properly, the vice chairman takes over the executive functions immediately.

Head Of Academy. The head of Academy is Mr. XXXXXXX. He holds an HND in Banking & Finance and has been teaching all his life. A born teacher, who we poached from a big school in Cross Rivers State.

Asst. Head of Academy Secondary. (Mr. XXXXXXX). He is currently doing his PhD part time having bagged a master from University of Ibadan. Very versatile and hard working.

Asst. Head of Academy Primary. (Mrs. XXXXXXXX). She holds an NCE in Agricultural science. A natural teacher of children. Funmi does not believe a child cannot be bright.

Head Of Operations. (Mrs. XXXXXXX). She holds a Diploma in Computer Science. A mother and a teacher. She is warm and easily liked by people. XXXXX is the utility staff who crosses all boarders.

They are ably assisted by the followings.
XXXX B.Sc
XXXX NCE
XXXX NCE
XXXX NCE
XXX B.Sc
XXXXX B.Sc
XXXXX NCE
French Teacher Dip
XXXX Driver
XXXXXX Cleaner

EQUITY CONTRIBUTUION

For this proposal, the equity contribution of 30per cent was uused for flooring of the school and chanellisation.

or
In the Account in The Bank

FUNFD UTILISATION PLAN
The plan is to increase the pupil’s population to 250 in 2015/2016 academic year.
2013/2014 160
2014/2015 200
2015/2015 250

Parents and pupils use the services and the infrastructure in each school to determine the level of patronage. The exiting parents are pleased with the present level of academic standards particularly when a high percentage of our pupils pass public examinations to secondary schools in primary four.
We added JSS1 this academic year which necessitated some structural changes and upgrading.
The additional facilities to be provided are as follows.

Concrete flooring of the whole school 300
Construction of gutter and drainage 50
Painting of the school. 300
Joining of 2 classrooms 150
Purchasing of two computers 150
Educational Aids 100
Furniture 100
Books 100
Tuning up buses 50
1300

As equity participation the following have been done
Concrete Flooring of the compound 300
Construction of gutter and drainage 50
350

Total 1300
Equity participation expended 350
Balance 950
Loan Needed N1.0M

CASH FLOW STATEMENT FOR XXXXXXXXXXX FOR 2013/2014

CASH INFLOW 000
Opening Balance 50
Equity 400
Loan 1000
Fees 5524
Tranport 1080
TOTAL INFLOW 8054
CASH OUTFLOW
Fooring 300
Painting 300
Clasroom 150
Gutter 50
Furniture 100
Computers&Internet 205
Library & Aids 200
Fuel 540
Veh Maintenance 200
Sal.&Wages 2086
Overheads 240
Management 780
Statutory Dues 100
Loan Repayment 1320
TOTAL OUTFLOW 6571

CASH BALANCE 1483

12 MONTHS CASH FORECAST FOR xxxxxxxxxxxxxx FOR 2013/2014
0
AUG SEPT OCT NOV DEC JAN FEB MAR APR MAY JUN JUL Aug.
Opening Balance 50 340 69 88 242 285 319 773 1132 746 842 1296 1678 50
Loan 1000 0 0 0 0 0 0 0 0 0 0 0 0 1000
Equity 400 0 0 0 0 0 0 0 0 0 0 0 0 400
School Fees 0 350 600 500 244 450 750 715 0 552 750 613 0 5524
Trpt. Fees 0 0 0 160 200 0 160 200 0 0 160 200 0 1080
TOTAL(A) 1450 690 669 748 686 735 1229 1688 1132 1298 1752 2109 1678 8054

EXPENSES
Fooring 300 0 0 0 0 0 0 0 0 0 0 0 0 300
Painting 300 0 0 0 0 0 0 0 0 0 0 0 0 300
Clasroom 150 0 0 0 0 0 0 0 0 0 0 0 0 150
Gutter 50 0 0 0 0 0 0 0 0 0 0 0 0 50
Furniture 100 0 0 0 0 0 0 0 0 0 0 0 0 100
Computers&Internet 100 50 5 5 5 5 5 5 5 5 5 5 5 205
Library & Aids 50 50 50 50 0 0 0 0 0 0 0 0 0 200
Fuel 0 30 60 60 30 45 60 60 15 60 60 60 0 540
Veh Maintenance 0 50 25 25 0 0 25 25 0 25 25 0 0 200
Sal.&Wages 0 251 251 176 176 176 176 176 176 176 176 176 0 2086
Overheads 0 20 20 20 20 20 20 20 20 20 20 20 20 240
Management 60 60 60 60 60 60 60 60 60 60 60 60 60 780
Statutort Dues 0 0 0 0 0 0 0 100 0 0 0 0 0 100
Loan Repayment 0 110 110 110 110 110 110 110 110 110 110 110 110 1320
TOTAL (B) 1110 621 581 506 401 416 456 556 386 456 456 431 195 6571
Bal.(A-B) 340 69 88 242 285 319 773 1132 746 842 1296 1678 1483 1483

150,000 August salary will spread over Sepember and octiber and October

PROFIT AND LOSS ACCOUNT FOR XXXXXXXXXX FOR THREE YEARS 2010/11 TO 2012/13
2010/11 2011/12 2012/13
000 000 000
Revenues 3500 4000 4500

Deduct
Wages & salary 1300 1460 1620
Management 480 480 480
Overhead 84 84 120
statutory dues 50 50 50
Fuel 200 270 270
Vehicle maint. 70 70 70
Interest on laon 0 0 0
Total Expenses 2184 2414 2610
Gross Profit 1315 1586 1890
Less depreciation 970 970 970
Net profit 345 616 920

SHEDULE OF DEPRECIATION
Item Value Depreciation Dep. Value Dep. Value Dep. Value
Land & Buiging 15000 5% 750 750 750
Computer 200 20% 0 0 0
Furniture 300 20% 60 60 60
Teahing aids 100 10% 10 10 10
Vehicles 1000 30% 150 150 150
970 970 970

ANALYSIS OF REVENUE FOR xxxxxxxxx ACADEMY FOR 2013/2014

FIRST TERM SECOND TERM THIRD TERM
School Population Fees Revenue Fees Revenue Fees Revenue
Secondaryu 30 17.5 525 17.5 525 17.5 525
Primary 70 10 700 12 840 12 840
Nursery 60 9 540 10.5 630 10.5 630
Total 1765 1995 1995
4% for Debt 71 80 80
Fees Revenue 1694 1915 1915
Transport 360 360 360
TOTAL REVENUE 2054 2275 2275

Total For the year= N(2054 + 2275 + 2275) = N6604

Assumptions.
We have allowed 4% for debt even as most people pay even if hey carry till next term
Pupils population does not include the ones we have given scholarships as ours
Own corporate social responsibility.
In the secondary we expect 4 to join our present 11 students in JSS1. join our present 11 in JS1 to make 15 in JS2.
We expect at least 15 in our new JS1. feasible, even in our first year we started with 15.
With this upgrading getting 15 will be a child’s play
In the primary, our leaving finalists will be replaced with new ones to maintain our present
population of 130.
So, we expect 130 in primary and 30 in Secondary.
For transportation, we expect at least 60 at N6000 per term. The least charged by competitors s N7000 per term

STATEMENT OF STAFF COST FOR xxxxxxxxxxxxxxx ACADEMY
XXXX HNd 20000
XXX Dip 13000
XXXXX NCE 11000
XXXX M.Sc 12000
XXXXX B.Sc 12000
XXXXX NCE 8500
XXXXX NCE 8500
XX XXXXXXX NCE 9000
XXXXXX B.Sc 8000
XXXXX B.Sc 12000
XXXXXXXX NCE 9000
XXXXXX Benin Dip 7000
Sunay O Driver 10000
XXXXX Cleaner 7000
XXXXX 0
XXX 12000
XXX 7000
XXXX 10000
176000

Marketing

We are using SMS, word of mouth recommendation, fliers and banners.
Also using personal influence at the soldiers mess and joints.
We are doing a total re-branding. We re-sensitize our members and reorganize.
Staff will be uniformed from Monday to Thursday interchanging blue and white. Men to tie up.
We will have a uniformed gate man.
Our environment will be sparklingly clean.
The facelift itself is marketing.
Conclusion.
From the projected profit and loss account and the cash forecast giving a profit of a about a million naira after allowing for the repayment of the loan, it means this business can service this loan.
It is a feasible project and should be encouraged.

Note. You may be asked to submit more information which you should. A common question is your plan B for repayment should the project revenue not be met. For example, in this case should the school not meet the projected pupils enrollment, the revenue will drop and you should be able to convince them of alternative plan.
You can also elaborate on your marketing plan.

 

I am not good at making tables with WP. You can contact us for clearer tables in excel

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