Nigeria is cracking down on unregistered online money lenders who offer short-term loans with no security at high interest rates, according to the consumer protection agency, adding that it had asked Google to remove some lenders’ apps from its play store.
The lenders, dubbed “loan sharks” due to their aggressive recovery methods, charge interest rates of up to 45% per year. Applicants download an app, fill out a form, and are asked to give the lender access to their contacts for “risk management purposes.”

Millions of Nigerians who lack bank accounts or security to borrow turn to these lenders for loans starting at 2,000 naira ($4.76). Many people have taken to social media to complain about being harassed and having their contact information shared with third parties without their permission.

In an August 18 report, the Federal Competition and Consumer Protection Commission (FCCPC) stated that it had conducted search and seizure operations against at least five lenders.

According to FCCPC chief executive Babatunde Irukera, one of those targeted was Lagos-based Soko Lending Limited.

Irukera described Soko as “one of the most prolific actors in violating consumer privacy, fair lending terms, and ethical loan repayment/recovery practices.” He did not specify what was seized or recovered.

Soko did not respond to a written comment request.

Soko describes itself as a “simple, entirely online lending platform” that can process loan requests in five minutes.

Nigeria has the most fintech companies in Africa, with the majority of them offering loans. However, because of the lack of scrutiny, many businesses operated without regulatory approval, which the FCCPC hopes to change.

The FCCPC stated that it had asked Google Play to remove four lending apps that were circumventing investigations.

“For apps that are not on the Play Store, the commission is continuing to investigate what platforms they are hosted on in order to disable them,” said Irukera.

Payment systems Flutterwave, Opay, and Paystack, as well as mobile network operators, were ordered to stop providing platforms, hosting services, and connectivity to lenders, he added.

SOURCE:https://brandspurng.com/2022/08/19/nigeria-takes-action-against-unregistered-online-money-lenders/

What is CBN doing?

Time to clamp down on those arrant predators.

Finally

Way to Go.
Rather late than NEVER.

No Be Small Thing ooooo

Many people have taken to social media to complain about being harassed and having their contact information shared with third parties without their permission.

Na dis one dey pain people pass!
We swear down!!

post=115969370:
Way to Go.
Rather late than NEVER.

You No Dey Sleep?

#

Loan apps have entered once chance.

I know I'll get criticized for this but on the major issue of loan apps in Nigeria, the problem isn't the loan companies but Nigerians that borrow loans without genuine intention to repay.

I see comments like "their interest rate is too high", "their time frame is too short" "why will they call my contacts". BUT YOU KNEW ALL THESE TERMS BEFORE YOU COLLECTED THE LOAN.

Are these companies father Christmas or what? They may have adopted wrong means to recover their debt but let's face the fact, the lenders are the prime problem here

Now someone with genuine emergency cannot access loans because those with criminal intention have sabotaged the entire system

If as a Nigerian, you've never had to patronise these money lenders even for once, then you're the real MVP.

One by one

Lol. In as much as the modules of operation is not fair and ethical they are saving people that are in dear need for urgent financial help.

There people that can never beg or ask anyone for money no matter the situation. They rather collect 35% to 45% loans from these loan sharks. To save face.

The federal government is only looking for tax and for them to registered for bribe and nothing more.

They never care about the masses

Good

Listing

Good move, the threat from some loan shark can make someone commit suicide.

Good

Just remember that these loan guys has helped and saved alot of Nigerians. Let's not throw away the child with the bad water

Noted.

Well, I disagree with you on this... Here's my reason... “one of the most prolific actors in violating consumer privacy, fair lending terms, and ethical loan repayment/recovery practices.” Meaning they are using illegal means to issue out the loans to desperate citizens. Taking advantage of their situation to invade their privacy and that of their loved ones without their permission. That's illegal.

nairalee:
I know I'll get criticized for this but the problem isn't the loan companies but Nigerians that borrow loans without genuine intention to repay.

I see comments like "their interest rate is too high", "their time frame is too short" "why will they call my contacts". BUT YOU KNEW ALL THESE TERMS BEFORE YOU COLLECTED THE LOAN.

Are these companies father Christmas or what? They may have adopted wrong means to recover their debt but let's face the fact, the lenders are the prime problem here

Now someone with genuine emergency cannot access loans because those with criminal intention have sabotaged the entire system

ok

we hear

Government should go after those evil people.... they are evil

Good...

They don't call your contacts again

GardenOfGod:
Well, I disagree with you on this... Here's my reason... “one of the most prolific actors in violating consumer privacy, fair lending terms, and ethical loan repayment/recovery practices.” Meaning they are using illegal means to issue out the loans to desperate citizens. Taking advantage of their situation to invade their privacy and that of their loved ones without their permission. That's illegal.

They are using illegal means and yet many Nigerians are still collecting loans from them with no idea/means to pay back. Those borrowing money from loan sharks are greedy people, many of them know within them that they cannot pay back those loans and yet they still go ahead with collecting it. The loan sharks know many people are greedy and that's how they are able to lure them in.
Interest rate is 45%, banks don't even charge that high and yet people are still going to them for loans.

Why can't these people go to banks to collect loans?
Because they know they don't meet the requirements of being either a salary earner or they wouldn't be able to pay back.

This report doesn't really capture the situation. Most Microfinance banks in Nigeria give loans at around 3.5-5% monthly interest which translates to between 30 to 60% interest per annum.

Loan sharks on the other hand give between 12-30% per month for the "semi-sensible" ones like (fairmoney, menacredit, umba, etc) thus translating to around 150 - 350% per annum, while the terrible Agbero styled ones like Sokoloan, Lcredit and co give between 50- 150% per month thus translating into around 600-1800% per annum.

It's failure of governance and the corruption of CBN that makes people patronize these criminal organizations. Today, getting a bank loan with fair interest is very difficult especially if one does not earn salary. Loans are given as if they are doing one a favor.

Worst still is the fact that Nigerians generally like awoof. We don't like paying back debt even to family members thus making genuine borrowers skeptical. We really need a robust application of technology to integrate people into this bvn thing and help genuine lenders in recovering their loan repayment easily. We also need the proper regulations that will defeat these loan sharks once and protect consumers

You don't blame the people looking for proper means to mitigate their problems, rather, you blame the instigator of the means of mitigating the problem. If these fintech didn't take advantage of their situation, people wouldn't have bothered to collect the loan in the first place. So you blame the illegal loan companies.

IamMobisola:

They are using illegal means and yet many Nigerians are still collecting loans from them with no idea/means to pay back. Those borrowing money from loan sharks are greedy people, many of them know within them that they cannot pay back those loans and yet they still go ahead with collecting those loans. The loan sharks know many people are greedy and that's how they are able to lure them in.

Why can't these people go to banks to collect loans?
Because they know they don't meet the requirements of being either a salary earner or they wouldn't be able to pay back.

GardenOfGod:
You don't blame the people looking for proper means to mitigate their problems, rather, you blame the instigator of the means of mitigating the problem. If these fintech didn't take advantage of their situation, people wouldn't have bothered to collect the loan in the first place. So you blame the illegal loan companies.

LMAO
So you are saying these fintech companies are the reason why people take Loans? Really?
These same people who take loans to pay back debts incurred by a previous loan? These same people who take loans to sort out financially crises pending the time they get paid from work?

Do you know how many people have benefitted from these Loan companies?

Why aren't you blaming the banks too for not providing an easy way for people to collect loans from them?

Especially the Angel loan guys. One called me that a family member collected noney, sent his picture to me on WhatsApp with unprintable names, when I asked when the loam was due, he said over 19hours......and it was on Sunday

Even registered ĺenders and Nigerian banks are also sharks and need to be checked. One bank charges over 6% flat for Pay Day loan with tenor 30 days or less. This translates to no less 100% effective rate per year