₦airaland Forum

NL1960:
If you take a loan of 500k for 5 months for instance, this will be the calculation:

Principal Repayment = Loan Amount/Duration = 500,000/5 = 100,000/month

Interest Repayment = Loan Amount * (Interest Rate/100) = 500,000 * (1.5/100 ) = 7,500.

Total Monthly Repayment = Principal Repayment + Interest Repayment = 100,000 + 7,500 = 107,500.

NB: Microfinance Banks charge per flat per month

This is the correct payment, they ought to use reducing balance. Since principal was reduced by 100k every month the borrower should not be paying N107,500 every month

emmanuelewumi:
If that is the case, pay your monthly interest and pay back the principal at maturity which is 5 months

The MFBs will not allow you to do this unless you are a Special customer. That is why i put 'NB' there. The MFBs use 'Flat' method and not 'Reducing Balancing' method.

emmanuelewumi:
This is the correct payment, they ought to use reducing balance. Since principal was reduced by 100k every month the borrower should not be paying N107,500 every month

They ought to but that is not what they do. They do 'Flat'. Interest remain the same throughout the duration.

NL1960:
The MFBs will not allow you to do this unless you are a Special customer. That is why i put 'NB' there. The MFBs use 'Flat' method and not 'Reducing Balancing' method.

Well I don't do business with microfinance banks.

Since it is monthly interest, nothing stops the customer from paying the interests every month and pay the principal repayment to a separate money market fund on a monthly basis at the end of the 5th month liquidate the money market fund me pay back the principal

emmanuelewumi:
Well I don't do business with microfinance banks.

Since it is monthly interest, nothing stops the customer from paying the interests every month and pay the principal repayment to a separate money market fund on a monthly basis at the end of the 5th month liquidate the money market fund me pay back the principal

If the Microfinance bank customers were this financial savvy, they would not have accepted this 'Flat' method in the first place. If the MFB customers are given a repayment schedule that has different repayment amount on a monthly basis, they get confused. They want to be told 'oga/madam, by month end, you go dey pay us xxxxxxx amount as Principal and xxxx as Interest' instead of 'oga/madam, for first month, na xxxx and xx. for second month na yyy and zzz, for third month na aaa and bbb'. A Keke Napep or Bus Driver with a Keke or Bus on a lease wants to just know how much he/she is to deliver on a daily basis.

I think we had this discussion sometime last year about this issue, which is why I have some understanding of what it is. The interest as you have stated is 15%, but when you normilised it per annum, it becomes 36%.
But rather than tell their customers 36%, they divide it by 12 months and call it 3%/month to make it sound low but it does not change the fact that it is still 36% per annum.
I happen to have had the opportunity to read a loan document that was advertised at around 5% to be paid in 18 months, because I was looking out for the annual interest rate, I noticed somewhere in the fine prints that it had normalized per annum to be around 69% per annum.
The guy needed the money urgently as an opportunity was about to pass within a time frame and he was sure that with his salary, he could conveniently offset it.

emmanuelewumi:
Micro finance banks use per month, so at 3% per month for 5 months your total interest will be 15%.[b][/b]


I got an asset backed loan from United Capital last week at 15% for 6 months. Both principal and interest will be paid back in 6 months time, my total interest will be about 7.5% when the loan is due for payment

ojesymsym:
I think we had this discussion sometime last year about this issue, which is why I have some understanding of what it is. The interest as you have stated is 15%, but when you normilised it per annum, it becomes 36%.
But rather than tell their customers 36%, they divide it by 12 months and call it 3%/month to make it sound low but it does not change the fact that it is still 36% per annum.
I happen to have had the opportunity to read a loan document that was advertised at around 5% to be paid in 18 months, because I was looking out for the annual interest rate, I noticed somewhere in the fine prints that it had normalized per annum to be around 69% per annum.
The guy needed the money urgently as an opportunity was about to pass within a time frame and he was sure that with his salary, he could conveniently offset it.

3% per month is 36% per annum, 5% per month is 60% per annum.

Most traders don't need loans for 12 months na

nwaogukings03:
Talking about rule number one, please who understands how BRANCH works? Branch is a digital bank, like KUDA, but offers a higher interest rate of 20% on investments which can be withdrawn anytime. Withdrawals from Branch app are free, though capped at 100k. For every 100k withdrawal into a normal bank, bank charges apply. So assuming you want to withdraw 500k, bank charges multiply by 5. Since the bank charges are done by your normal bank, how then does BRANCH afford to give 20% ROI per annum? How do they generate their income?

branch is good... And legit. . Your capital is safe...

omotola90:
branch is good... And legit. . Your capital is safe...

This not the answer to his question(s)

ZEAK:
This not the answer to his question(s)

branch is able to offer that simply because they don't have branches scattered all over the country for maintenance and the likes, the most downloaded app on play store(before peeps start saying I'm advertising for them) has their finance office in St. Nicholas house Catholic street Victoria island lagos Nigeria... Licenced by cbn, they are credible just I've stressed earlier.... Their partners are visa and andressen horrowitz(early backers of Facebook).... I'm reffering to the person who ask about branch

omotola90:
branch is able to offer that simply because they don't have branches scattered all over the country for maintenance and the likes, the most downloaded app on play store(before peeps start saying I'm advertising for them) has their finance office in St. Nicholas house Catholic street Victoria island lagos Nigeria... Licenced by cbn, they are credible just I've stressed earlier.... Their partners are visa and andressen horrowitz(early backers of Facebook).... I'm reffering to the person who ask about branch

Catholic mission street is not in Victoria Island. It is on Lagos Island very close to TBS

emmanuelewumi:
Catholic mission street is not in Victoria Island. It is on Lagos Island very close to TBS

yes please... TBS

Educationalserv:
Jew man na akara and bread u sabi.

Hello chief,
Good evening.
Please say a friend of mine has made up his mind to buy a truck(Howo ) dumptruck for sand and gravel,
How much should he expect as weekly/monthly returns?
Which would you advise the person to buy?
Sand,trailer,or which?
I don't like tanker because I feel its market is limited?
Or is it?
Please help me out here,thank you.

SeaTrade:
Hello chief,
Good evening.
Please say a friend of mine has made up his mind to buy a truck(Howo ) dumptruck for sand and gravel,
How much should he expect as weekly/monthly returns?
Which would you advise the person to buy?
Sand,trailer,or which?
I don't like tanker because I feel its market is limited?
Or is it?
Please help me out here,thank you.

Na you jooor.

You no wan make we tax you

Nezzjnr:
Na you jooor.

You no wan make we tax you

Bad guy

Buy 10 tyres sand truck, carry am come Lekki and make good money provided you have a driver you can trust or you can put tracker on it.

But free ukwu no dey Lekki tho

SeaTrade:
Hello chief,
Good evening.
Please say a friend of mine has made up his mind to buy a truck(Howo ) dumptruck for sand and gravel,
How much should he expect as weekly/monthly returns?
Which would you advise the person to buy?
Sand,trailer,or which?
I don't like tanker because I feel its market is limited?
Or is it?
Please help me out here,thank you.

XiaoLi:
Buy 10 tyres sand truck, carry am come Lekki and make good money provided you have a driver you can trust or you can put tracker on it.

But free ukwu no dey Lekki tho

Lol like how much can it generate weekly?
Because to throwaway that kind big money to dey chase change no be am ooo.
As for ukwu,if free one no dey I go import

.

.

New one can generate 300-350k weekly, that change wey you go throaway for the truck is still better than using it for import na

SeaTrade:
Lol like how much can it generate weekly?
Because to throwaway that kind big money to dey chase change no be am ooo.
As for ukwu,if free one no dey I go import

XiaoLi:
New one can generate 300-350k monthly, that change wey you go throaway for the truck is still better than using it for import na

How much is the driver's salary? How much will he keep every month to take care of emergency and maintenance?

How much is the truck?

The person who manages the truck will take care of any maintenance less that 10k, any maintenance upto 100k will be taken care by the owner of the truck..both parties can also negotiate on how to share the maintenance cost too, brand new Howo is unlikely to develop any serious problem in 2years except in a case of accident, the only maintenance which is likely to cost more money is changing of tyres but it is always advisable to buy up to 4 brand new tyres while buying the truck..this way you will enjoy the truck for up to a year without headache..I think a brand new one cost thirty something M.

emmanuelewumi:
How much is the driver's salary? How much will he keep every month to take care of emergency and maintenance?

How much is the truck?

XiaoLi:
The person who manages the truck will take care of any maintenance less that 10k, any maintenance upto 100k will be taken care by the owner of the truck..both parties can also negotiate on how to share the maintenance cost too, brand new Howo is unlikely to develop any serious problem in 2years except in a case of accident, the only maintenance which is likely to cost more money is changing of tyres but it is always advisable to buy up to 4 brand new tyres while buying the truck..this way you will enjoy the truck for up to a year without headache..I think a brand new one cost thirty something M.

You see where the problem is?
Why should a person spend 30M+ to be chasing 350k monthly na haba!!!
When will the truck now balance up its investment?
I have been looking at some random figures yesterday and I noticed something.
Most people that have contract jobs for these things prefer HOWO.They always insist on HOWO or nothing.
2)I noticed they pay per tonnage,
I saw 15,000/ton from ogun to cross river.
So if a person buy a 40 ton HOWO truck brand new,it will cost like 38-40m.
So paying me 15k/ton implies the trip is 15k/ton×40ton carrying capacity=600k/trip.
And when coming back,they load some other thing to the base,meaning 1,2m/round trip.
According to data,2 round trips can be made weekly,meaning 4,8m/month gross.
Then go to expenses and so on,you find out that the truck can recoup its investment in 15-18months which isn't bad,provided it suffers no major damage which is unlikely since I will prefer to buy brand new abeg,I no get strength for old vehicles olorun!
Buy good insurance and I think by so doing a person have mitigated most of the risks.
Then the remaining problem now will be local government people and their useless agbero tax and NURTW wahala!
Then put tracker to monitor driver too thrn pay driver per trip.
But all these are just theory as I have no major experience in this.

XiaoLi:
The person who manages the truck will take care of any maintenance less that 10k, any maintenance upto 100k will be taken care by the owner of the truck..both parties can also negotiate on how to share the maintenance cost too, brand new Howo is unlikely to develop any serious problem in 2years except in a case of accident, the only maintenance which is likely to cost more money is changing of tyres but it is always advisable to buy up to 4 brand new tyres while buying the truck..this way you will enjoy the truck for up to a year without headache..I think a brand new one cost thirty something M.

At N30 million and above, it will take about 9 years to recover the money invested.

Please correct me if I am wrong

SeaTrade:
You see where the problem is?
Why should a person spend 30M+ to be chasing 350k monthly na haba!!!
When will the truck now balance up its investment?
I have been looking at some random figures yesterday and I noticed something.
Most people that have contract jobs for these things prefer HOWO.They always insist on HOWO or nothing.
2)I noticed they pay per tonnage,
I saw 15,000/ton from ogun to cross river.
So if a person buy a 40 ton HOWO truck brand new,it will cost like 38-40m.
So paying me 15k/ton implies the trip is 15k/ton×40ton carrying capacity=600k/trip.
And when coming back,they load some other thing to the base,meaning 1,2m/round trip.
According to data,2 round trips can be made weekly,meaning 4,8m/month gross.
Then go to expenses and so on,you find out that the truck can recoup its investment in 15-18months which isn't bad,provided it suffers no major damage which is unlikely since I will prefer to buy brand new abeg,I no get strength for old vehicles olorun!
Buy good insurance and I think by so doing a person have mitigated most of the risks.
Then the remaining problem now will be local government people and their useless agbero tax and NURTW wahala!
Then put tracker to monitor driver too thrn pay driver per trip.
But all these are just theory as I have no major experience in this.

No that easy to have jobs every time, there are weeks you won't get jobs

emmanuelewumi:
No that easy to have jobs every time, there are weeks you won't get jobs

Not really ooo,I cannot buy a truck brand new to be doing street work(pit or quarry to site) ooo ha!
I will buy something for contract haulage only.
Like for instance lafarge haulage of materials to and from their ogun and cross river plants.
Me and street work,my hand no dey because na that tike driver go use you catch fun!
Also,I think one way to curb scarcity of Job is to buy truck weh no common,like the 45ton HOWO weh big like house because many people can't afford it and it is the preference of people who give bulk jobs ,like companies.
What do you think?

Mistake on my previous message, i mean brand new Howo can generate 300-350k weekly, thats around 1,200,000 monthly.

emmanuelewumi:
At N30 million and above, it will take about 9 years to recover the money invested.

Please correct me if I am wrong

XiaoLi:
Mistake on my previous message, i mean brand new Howo can generate 300-350k weekly, thats around 1,200,000 monthly.

Still poor!
With this you no fit recover your money in 2 years when you take away expenses,NURTW,local government and their bastard agbero!!
500k-600k/week makes more sense tbh...
If you want street jobs then don't buy brand new,all these 80s mack for 12m will do the job perfectly.
And the longer time it takes to recoup investment,the riskier it becomes cos these things have a penchant for rolling over and getting damaged!

My mistake, brand new howo can generate 1.2M monthly that is 300-350k weekly, without accident this amount is guaranteed in Lekki which i'm converstant with.

SeaTrade:
You see where the problem is?
Why should a person spend 30M+ to be chasing 350k monthly na haba!!!
When will the truck now balance up its investment?
I have been looking at some random figures yesterday and I noticed something.
Most people that have contract jobs for these things prefer HOWO.They always insist on HOWO or nothing.
2)I noticed they pay per tonnage,
I saw 15,000/ton from ogun to cross river.
So if a person buy a 40 ton HOWO truck brand new,it will cost like 38-40m.
So paying me 15k/ton implies the trip is 15k/ton×40ton carrying capacity=600k/trip.
And when coming back,they load some other thing to the base,meaning 1,2m/round trip.
According to data,2 round trips can be made weekly,meaning 4,8m/month gross.
Then go to expenses and so on,you find out that the truck can recoup its investment in 15-18months which isn't bad,provided it suffers no major damage which is unlikely since I will prefer to buy brand new abeg,I no get strength for old vehicles olorun!
Buy good insurance and I think by so doing a person have mitigated most of the risks.
Then the remaining problem now will be local government people and their useless agbero tax and NURTW wahala!
Then put tracker to monitor driver too thrn pay driver per trip.
But all these are just theory as I have no major experience in this.

In Lekki you are guaranteed with Jobs everytime, infact most times we don't get supply because of short of trucks.

emmanuelewumi:
No that easy to have jobs every time, there are weeks you won't get jobs

With this frequent naira devaluation how much can thesame amount generate from importation monthly?

SeaTrade:
Still poor!
With this you no fit recover your money in 2 years when you take away expenses,NURTW,local government and their bastard agbero!!
500k-600k/week makes more sense tbh...
If you want street jobs then don't buy brand new,all these 80s mack for 12m will do the job perfectly.
And the longer time it takes to recoup investment,the riskier it becomes cos these things have a penchant for rolling over and getting damaged!

XiaoLi:
With this frequent naira devaluation how much can thesame amount generate from importation monthly?

Depends on what you can import,
If you are a daredevil with better connect,bros that thing go be child's play ooo.
But let's play safe ,transport is a good sector as it always have demand, different unrelated clientele plus zero credit.
Devaluation can only dull your sales as an importer but usually the people that bare the brunt is the populace.
I am not even interested in import,na major distributor work for a moving product I dey find now but everywhere seems to be saturated!