Nalda Update

Three (3) Important things to know about NMFB Non-Interest Loan

Three (3) Important things to know about NMFB Non-Interest Loan.

NMFB Non-Interest Loan

Following the commencement of the COVID-19 Non-Interest Loan approval by the Nirsal Microfinance Bank (NMFB), many applicants have yearned for a better understanding of the NMFB Non-Interest Banking Window.

Here are thre3 (6) Important things to know about the Non-Interest Banking Window for TCF and AGSMEIS.

1. The COVID-19 Non-Interest Banking Window for TCF and AGSMEIS is not the same as the popular COVID-19 Targeted Credit Facility Loan or the AGSMEIS Loan.

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The major difference is that while there is a direct cash disbursement for the COVID-19 Targeted Credit Facility Loan or AGSMEIS Loan as the case may be, the Non-Interest Banking Window for TCF and AGSMEIS is for direct cash disbursement.

What this means is that in accessing the Non-Interest Loan, an applicant needs to input the details of the items he/she wants to be financed, which must be within the range of the amount applied for.

The applicant will also verify the exact price from a vendor which the applicant will also attach to the application in the next stage. The vendor receives the direct fund. This will be explained in No 2. Just follow me.

2. There are three 3 Stages in accessing the Non-Interest Loan.

Phase 1: Application for Financing

In this stage, an applicant provides relevant personal information and the business to be financed.

Phase 2: Acceptance of Offer and other Agreements

A successful applicant will be notified when his/her application is approved. The approval has commenced already but that’s not all.

The applicant will be required to do the following:

• Generate the Offer Letter and accept it

• Generate the Undertaking to Buy Agreement and accept it. (Read this agreement very well).

• Input the details of the items to be financed. This must conform with the approved amount as shown on your offer letter.

Phase 3: Upon fulfillment of Phase 2, the beneficiary would wait for the disbursement of funds to the proposed vendor. The funds will be used to purchase equipment and raw materials from the vendor. Either NMFB or the beneficiary as its agent will then be assigned to take delivery of the assets. After taking delivery, the beneficiary will be required to execute the agreement on the final stage of the contract.

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3. COVID-19 Targeted Credit Facility Loan and AGSMEIS Loan Scheme are loans that must be repaid-with an Interest rate of 5-9% per annum. The Non-Interest Banking Window recognizes only the sharing of profits from the investment with the beneficiary.

That is, the profit accrued from the business will be shared with the Lender – which is the Nirsal Microfinance Bank. However, no interest is attached to the Loan and the Loan will not be repaid by the beneficiary in part or lump sum. That’s why the Non-Interest Banking Window for TCF and AGSMEIS focuses on assets financing than direct loan disbursement to beneficiaries.


Phillip Anuforo is the founder and CEO of He is dedicated to providing information relating to jobs, scholarships and education.

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