Nigerians decry threat, intimidation, cyber bullying by loan sharks

Nigerians decry threat, intimidation, cyber bullying by loan sharks.

Some Nigerians have been complaining about improper activities of “loan sharks” who offer them unsolicited loan facilities only to start harassing them when there is delay in repayment.

According to the News Agency of Nigeria, these loan sharks are mostly fintech companies that offer loans at high rate returns, strict terms of collection upon failure, and generally operate outside the law.

Some of the fintech companies involved in loan offerings include Sokoloan, Gocash, Getcash, Fastmoney, Cashlion, and Lcash.

They mostly charge high interest rate and service charge. They also give small amounts of money and short period of repayment, and most borrowers usually default in payment due to these conditions.

According to one borrower, Isaac Aliu, some of these lenders take extreme and unacceptable steps to recover their money.

“Imagine the situation where an agent is posting an imaginary obituary of a defaulter. That is an extreme action and should be met with heavy sanction.

“I still wonder why they take these drastic actions without the knowledge of authorities like CBN.

“Someone committed suicide recently because of this kind of embarrassment. It is better this loan apps get banned or subjected to strict regulation, ” he said.

Matthew Oba narrated how one of the companies defamed him, even after repayment of his loan.

“I took a loan of N6000 from (one of the loan companies). They sent defamatory messages to all my contacts even after repayment have been made.

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“They are so quick in taking drastic actions by posting ones pictures to contacts which was not part of the agreement.

“They are worse than shylocks. They act polite when calling someone to take their loans only for them to become wild when it is time to pay back.

“Their mode of operation is fraudulent because most times the interest they charge is more than the one in their agreements,” he said.

Another borrower, speaking on condition of anonymity, bemoaned the death of his relative due to harassment by some of the loan sharks.

“My brother committed suicide in January due to harassment.  Another defamatory notification dropped on his phone by CreditAll, I wonder how many more.

“They could have called the guarantor instead of all the contacts,” he said.

According to Ayoade Babatunde, a Chartered Accountant,  some of the fintechs offering such loans are usually in breach of certain regulations.

“They breach the third party protection policy, thereby taking Laws into their hands without notifying the right authorities.

“They engage in defamation of character , which is likened to cyber bullying and have led to mental disability, emotional trauma and even death in some cases.

“They impose excessive interest rates , which have increased  poverty levels of many of their victims, ” he said.

He called for a decisive regulatory action to curb excesses of these loan sharks.

Meanwhile,  the Central Bank of Nigeria (CBN) has warned Nigerians to desist from accepting loans offer from such companies.

The CBN Governor,  Mr Godwin Emefiele, gave the warning during the last  Monetary Policy Committee (MPC) meeting in Abuja.

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Emefiele explained that those who go to collect loans from places other than microfinance banks or recognised institutions are at bigger risk.

“There is no need for you to go to loan sharks for a loan. People normally go to loan sharks because they are desperate and can’t access the bank.

“We found out that those that are vulnerable are households who need money to do their businesses but they cannot  access bank finance.

“As a result they go to loan sharks who charge them way above the amount borrowed and expected to pay back in 90 days and if that does not  happen, they seize your house or bikes.

“We can only continue to advise that there is no need to go for loan sharks,” he said.

Emefiele urged Nigerians to take advantage of  the various avenues put in place by the apex bank to access credit.

“The CBN has put in place the avenue through which you can raise your finance, like through the targeted credit facility or the SMEs loan that was set up through our microfinance banks.

“You do not have to know anybody, just go to the portal and fill the form, send your data, and if it is correct, you will be able to access loans,” he said.

He said that several people have benefited from the microfinance strategy to give out loans at affordable rates, adding that CBN would go after loan sharks.

“The CBN is putting effort to stop loan sharks, and when these people are found, they will be dealt with mercilessly,” he assured.