Getting a loan from a traditional Nigerian Bank has been a herculean task. With the requirements and conditions attached, it was almost as if these loans were designed for a select few. Moreso, there was no consideration for immediate loans for individuals to meet their urgent 2k needs. Online loan apps stepped in to bridge these gaps.

When these guys first came into the scene, Nigerians were grateful for their thoughtfulness. You could access loans for emergencies without needing to bring your grandmother's kidneys! But then came repayment time and they began to understand some of the reasons why traditional Banks shunned this mass sector, repayment issues. And these loan agencies got bullish. When they weren't threatening their customers, they were actually blackmailing them, invading their privacies and committing several other crimes. These acts have totally robbed them of whatever goodwill they had with the general public. In fact, the consensus now is for their borrowers to withhold their repayments whenever they resort to any of their underhanded tactics. Even on this platform, once a Nairalander complains that a loan app has sent messages to his contacts, the overwhelming majority immediately advises him not to repay anymore since they have done their worst. Sadly, this advice is not in the interest of the borrower.

You see, when someone takes a loan, this loan is registered in a central database and updated with defaults or repayments accordingly. Now for those who refuse to pay the loan, the loan apps simply update it that the loans are in default. This might not matter to the borrower now. However, if such a person ever wants to access a real loan in future, then shit hits the fan.

Banks are mandated to do credit checks on any customer before granting a loan. They typically generate the customer's credit history from 3 or 4 credit bureaus and these credit reports must show no outstanding borrowing for the loan to be approved. That means, a small debt of 1kobo reported by any of these agencies would be enough reason for a bank to decline lending 100million to a customer. Now think about this for a second. A future breakthrough can be thwarted by a very small indiscretion. Now, you could argue that yes, when you get to that bridge, you'll cross it. Fine. Now pause and think for a moment, what if the loan app has stopped existing by then, who then will you make repayment to and who will update your credit history?

As it is, updating credit history is even hard for some banks not to talk of online loan apps without physical presence. They could deliberately frustrate the borrower! Now, this is before GSI o.

GSI is how some banks recover money from some incorrigible borrowers now and was recently okayed by CBN. How does it work? Very simple. You owe bank A and have money in bank B. Bank A simply passes your debt information to bank B, who will now send whatever balance you have with them to settle your indebtedness. I am sure that these loan apps will try to key into this too when they have got their politics right.

Now, I am neither for nor against any of the parties here. I am just pointing out the hidden pitfalls that the borrower might face by refusing to pay the loan.

Ciao.

SHIT
Thanks 4 d info.

You're welcome

ololololo:
Getting a loan from a traditional Nigerian Bank has been a herculean task. With the requirements and conditions attached, it was almost as if these loans were designed for a select few. Moreso, there was no consideration for immediate loans for individuals to meet their urgent 2k needs. Online loan apps stepped in to bridge these gaps.

When these guys first came into the scene, Nigerians were grateful for their thoughtfulness. You could access loans for emergencies without needing to bring your grandmother's kidneys! But then came repayment time and they began to understand some of the reasons why traditional Banks shunned this mass sector, repayment issues. And these loan agencies got bullish. When they weren't threatening their customers, they were actually blackmailing them, invading their privacies and committing several other crimes. These acts have totally robbed them of whatever goodwill they had with the general public. In fact, the consensus now is for their borrowers to withhold their repayments whenever they resort to any of their underhanded tactics. Even on this platform, once a Nairalander complains that a loan app has sent messages to his contacts, the overwhelming majority immediately advises him not to repay anymore since they have done their worst. Sadly, this advice is not in the interest of the borrower.

You see, when someone takes a loan, this loan is registered in a central database and updated with defaults or repayments accordingly. Now for those who refuse to pay the loan, the loan apps simply update it that the loans are in default. This might not matter to the borrower now. However, if such a person ever wants to access a real loan in future, then shit hits the fan.

Banks are mandated to do credit checks on any customer before granting a loan. They typically generate the customer's credit history from 3 or 4 credit bureaus and these credit reports must show no outstanding borrowing for the loan to be approved. That means, a small debt of 1kobo reported by any of these agencies would be enough reason for a bank to decline lending 100million to a customer. Now think about this for a second. A future breakthrough can be thwarted by a very small indiscretion. Now, you could argue that yes, when you get to that bridge, you'll cross it. Fine. Now pause and think for a moment, what if the loan app has stopped existing by then, who then will you make repayment to and who will update your credit history?

As it is, updating credit history is even hard for some banks not to talk of online loan apps without physical presence. They could deliberately frustrate the borrower! Now, this is before GSI o.

GSI is how some banks recover money from some incorrigible borrowers now and was recently okayed by CBN. How does it work? Very simple. You owe bank A and have money in bank B. Bank A simply passes your debt information to bank B, who will now send whatever balance you have with them to settle your indebtedness. I am sure that these loan apps will try to key into this too when they have got their politics right.

Now, I am neither for nor against any of the parties here. I am just pointing out the hidden pitfalls that the borrower might face by refusing to pay the loan.

Ciao.

I have been seeing this rubbish on Facebook.

Loan apps don't carry out any KYC or credit search.

They don't report any default to any centralized database, except if they have their own "Loan sharks database" which the Central bank, commercial banks, and other licensed lenders have no business with.

Getting details of your credit history and credit score isn't rocket science, you can order a report with less than 10,000 from the comfort of your home/Office.

The only thing the "Loan shark" will hold against you is your "image" (that's if you give two f*cks about that).

If you fill up a phone with fake contacts, access a loan from them, and refuse to pay. That money is as good as a gift.

They can't do nothing!