Ever had your details circulated to your contacts and labelled as fraudulent for defaulting on a loan? Well, there just might be a respite on the way.
In today’s plenary session, the House of Representatives has made moves to look into the schemes of mobile application money lenders and fin-tech companies that threaten and tarnish the image of debtors for defaulting on their loan repayments.
The House of Representatives resolution followed a move and unanimous adoption of a motion by a member, Ahmed Satomi, titled ‘Urgent Need to Investigate Sharp Practices by Unregulated Online Fintech Lending Companies and Abuse of Mobile Digital Loan Apps in Nigeria.’
Ahmed Satomi, who described the activities of the illegal lenders as predatory and designed to defraud low-income earners, said, “The House is disturbed that these predatory lending apps are disguised as platforms where unsuspecting members of the public are promised access to quick loans with no collateral except the provision of a Bank Verification Number.
“The House is also disturbed that such victims are expected to repay loans at astronomical interest rates within three to seven days, as against the 91 to 365 days claim on Google Play store, which has over 83.07 per cent market share in Nigeria.
“The House is worried about the operations of Kash Kash, with a hosted operating account under the name Super Car Universal Limited with a certain commercial bank in Nigeria, where Kash Kash carries out activities of the loan app, such as the exorbitant interest rates they collected from customers and defamatory messages sent to contacts of their customers when they missed their repayment date.
“The House is also worried that such an account holder did not have the required license to operate as a money lender, which led the commercial bank to close the first account, but such operations were moved to another account named Speedy Choice which is still operational and managed by the same people who managed the previous account.
“The House is again worried that many of such online loan apps operating in Nigeria, disbursing loans to customers with no collateral and defaulters, are always sending threatening messages and that loan apps and other fintech products can be used for money laundering and other forms of illicit financial flows.
“The House is pained that these unregulated Nigerian fintech companies shame and threaten customers for late payment of loans,” Satomi said.
Satomi, the member of the House representing Jere Federal Constituency of Borno State, proceeded to implore the House of Reps to look into the activities of OKash, Opay, PayLater, PalmCredit, Branch, QuickCheck, Aella Credit, FairMoney, KiaKia, EasyCredit, NewCredit, Umba, Carbon, FirstNell, SoftNaira, SharpCash, Newcredit, Cash Mall, NairaLand, Naira9ja, New Credit Loan App, Future Cash, SharpCredit, MoneyHub, 9jaCash, Henloan, Get Loan, Plenty Cash, Fundy, iMoneyPlus, CashCredit, LifeLine, Lumos Loan, NairaPlus, Care Finance, Cashbean, CashMe, LoanMe, LifePurse iLoanPro, LairaPlus, OxLoan and NoNowMoney.
Responding, the House mandated the Committee on Banking and Currency, Financial Crimes, and Telecommunications to investigate the alleged sharp practices and abuses by fin-techs and online mobile digital loan apps in the country and report within four weeks.
