How to Write a Business Loan Application Letter [with Sample]

How to Write a Business Loan Application Letter – Borrowing funds from a bank or other lending organization for business purposes and repaying the funds with interest after a set time is known as a business loan.

Traditional bank loans, mezzanine financing, asset-based financing, invoice financing, microloans, business cash advances, and cash flow loans are just a few available types.

Also see: Top 85 Profitable Businesses to Start With 100K

Mortgages, auto loans, and educational loans are only some examples of the kinds of private loans that are commonplace. Commercial loans are similar to consumer loans in many ways, except that the money is used to expand a business rather than for a personal purchase.

Business loans are loans made to business owners or companies by banks, credit unions, or even private individuals. Every business needs initial capital as well as ongoing funding to survive.

In addition, a lender will want to look over your business plan, which should detail your financial projections, marketing strategy, business concepts, and goals. This means the lender would like to know how the funds would be used.

Step-by-Step Format of Writing a Business Loan Application Letter

Please make sure you include the following essentials when applying for a business loan:

  • Heading and greetings.
  • Summary of your business loan request letter.
  • Basic information about your business.
  • Explanation of the purpose of your loan.
  • Summarize your ability to repay the loan.
  • Conclusion (And don’t forget to proofread).

Wilson Dick
KMV Services Limited
+234 813 756 0001
51 Trans Amadi Industrial Layout
Port Harcourt, Rivers State
January 20, 2023

Steve Mark
Senior Loan Officer
Km 16 PH/Aba road expressway
Port Harcourt, Rivers State


Dear Mark,

I’m writing to request a ₦50,000,000 loan for my business in the maritime industry, KMV Services Limited. With this loan, KMV Services Limited would open two additional facilities to accommodate the growing demand from its prospective clients.

KMV Services Limited is a successful business established in the maritime industry. We began operation with six employees in April 2008 as a small company offering marine services to multinational maritime companies. We now have 40 employees. We also advertise on our company’s website; and post our services on our social media accounts.

Last year, our annual income totaled ₦15.5 million. In the first year of business, we earned a net profit of ₦2.8 million. Moreover, we have maintained a steady balance over the past 15 years.

Because of increasing interest from prospective clients in other locations, we have decided to open two more facilities. The loan we are requesting is for these additional facilities, which we expect will increase revenue by ₦1.5 million in the first quarter following opening.

Startup costs can be exorbitant, and we require funding to buy tools and equipment. Nevertheless, we expect good projects for the new branches and have immediate work opportunities, which will contribute to our loan repayments.

The loan of ₦50,000,000 we are requesting will provide us with the funding to help open our two facilities successfully. I have attached our contracts in the new facilities, pending equipment availability and ability to complete the project, and our business plan with a breakdown of costs and detailed market analysis.

Thank you for your time and consideration in reviewing this letter and the accompanying financial documents. I look forward to hearing from you at your convenience.


(Wilson Dick’s signature)
Wilson Dick
Executive Director

Please note that you must attach the following documents with the application letter: a business plan, profit-and-loss statement, balance statement, and cash-flow statement.

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