online loan apps in nigeria

10 facts about Nigerian loan apps you should know before taking an online loan

More people are taking online loans than you probably imagined. with the harsh economic realities in the country, these loan apps provide quick loans without asking for collateral and minimal documentation.

but also a lot of the ugly stories you might have heard about them is most likely true. Some of them often deploy less than civilized tactics to recover their loans, most loan apps charge ridiculously high interest rate for a short period of time and virtually all of them are not registered or regulated.

Here are some answers to questions you might have regarding loan apps in Nigeria.

Can a loan app block my BVN?

Biometric Verification Number BVN is a unique 11 digit number that identifies every Nigerian as the interact with the country’s financial infrastructure. The number is given and controlled by the CBN in association with licensed commercial banks.

So can a loan app block your BVN for not repaying your loan? technically the answer is no. Only the CBN can blacklist your BVN in cases were you seriously violated the country’s laws. Loan apps however can block your BVN on their app and even prevent you from getting loans from other loan apps.

A loan app cannot ‘BLOCK’ your BVN, they can only prevent you from getting further loans from their platform or getting loans from other loan app.

What happens if I cant repay my online loans?

Even before your due date you will start getting persistent calls and SMS from the loan company. After your due date they will start adding late fees to your balance. Then the loan company will try to auto debit the ATM card you have linked to your profile.

when all these fails, some online loan apps in Nigeria are notorious for sending derogatory messages to the contacts of their defaulters. others like Branch, Carbon and FairMoney will pass your contact to a loan recovery company that will call you persistently until you repay the loan.

Can I go to Jail for not paying online loans?

No you cannot go to jail for defaulting on your loan repayment. The loan company want their money, and when you’re in jail, the you definitely cant repay. Tho some loan sharks have been known to threaten their customers with lawyers and jail term, they cannot send anyone to prison.

Why do loan apps ask for BVN?

Your BVN is your unique identifier linked to every transaction you perform in Nigeria. Because every Nigerian only has one it makes it easier for the loan apps to identify loan defaulters and deny them loans.

Are loan apps legal in Nigeria?

Some loan apps are legally registered and regulated by the CBN as microfinance institutions. But majority of the online loan apps that operate in Nigeria are illegal and unregistered. See this list of CBN approved loan apps in Nigeria.

How do I block an online loan app?

You probably want to prevent the loan app from removing money from your bank account without your consent. After binding your ATM card to your profile, the only way to prevent this is to block and deactivate the ATM card. You can do this through your banks app or simply going to your bank to block your card and request a new one.

Changing your card password does not stop auto debit.

Can loan apps access my contacts even after uninstall?

Yes the still have your contacts, you grant them access to your contacts when you first download the app and most loan apps make a copy of your contacts immediately.

You can still prevent defamation by deleting your WhatsApp picture or limiting access to it to only your saved contacts by changing your privacy settings.

Most loan apps that defame people usually get their pictures from the WhatsApp profile.

Which loan app has the lowest interest rate in Nigeria?

Branch, Carbon, Kuda and commercial bank’s apps have low interest rates. The interest rate on loan apps is not uniform, it is influenced by factors such as credit score and repayment history of each individual borrower.

If you have further questions related to loan apps in Nigeria, leave it in the comment section below and check back on this webpage for updates.

I did not request a loan, yet money was disbursed to my bank account. what should I do?

Sometimes loan apps do disburse money into a customer’s bank account who did not request one, or a customer might fill out the form and later change their minds due to the high-interest rate or small repayment tenure, yet money will be disbursed into their accounts.
If you are experiencing something similar, immediately deposit back the principal amount that was sent to your bank account to avoid paying interest on it later.

I mistakenly overpaid more than I borrowed from a loan app, what should I do?

Maybe you’re supposed to pay back N12,000, but you mistakenly sent N120,000 to the loan app’s account. In such a situation, you should request another loan in the amount that you overpaid. That is N108,000 in this example. It is usually difficult to get reimbursements in such cases, which is why you should be very careful and double-check before confirming any transaction.

106 thoughts on “10 facts about Nigerian loan apps you should know before taking an online loan”

    1. Registered or not doesn’t really matter, they can all report you to credit bureaus to blacklist your BVN if you default on your loan repayment.
      Fairmoney and Migo don’t defame their customers. They are more professional unlike Lcredit that will defame you and send messages to your contacts.

  1. i took loan and i wanted to pay back but my phone was stolen along side my alert sim in which i used in registering for the app. i have not been able to get my line back. i have no other way to communicate with them. i tried sending mail but most of them do not have website. what should i do. my account has been freezed and i need to contact them and reach an agreement with them.

    1. Simply do a welcome back on your sim card. Or call their customer service number they will be able to dig up your records with your phone number and BVN.

        1. Most of these online loan apps are loan sharks that give high risk loans and charge high interest. If you want regulated loans you have to go through your banks and meet the necessary requirements.

          1. Please help me.
            When I wanted to borrow, I deactivated my Gmail acct where my contacts are. I borrowed with the acct where I just have random contacts. I dropped my real line as an alternative num and they have been threatening me on the whatsapp line. I hope they can’t have access to the contacts on the alternative whatsapp line.
            Note that when I wanted to borrow, those contacts were not on my phone. I just got them back .pls help.

          2. No, they won’t have access to your contacts as long as you deleted the app before restoring your contacts on your phone.

  2. Can a loan app report a defaulter to NIBSS and issue Global Standing Instruction(GSI), to recover their loan???

    1. No, most online loan apps are loan sharks that are not registered or regulated. The highest they can do is to report you to a credit bureau and stop you from getting further loans or affect you if you deal with anyone that runs a financial background check on you.

      1. Sir please I want to confirm if loan company like palmcredit can freeze your account until they recover all their money.

        1. Yes Kuda can blacklist your BVN from accessing loans, but you can still borrow from loan sharks that charge high interest rates and use intimidation to get their monies back.

    1. No, they cannot. Most of them are unregistered loan sharks anyways. The worse they can do is to blacklist your BVN from getting loans again. And only few of them can do that.

        1. Yes, apps like Fairmoney, Branch and Carbon can report your BVN to credit bureaus which will show that you have outstanding loans on your credit report.

  3. What if when you signed up on the loan app and they didn’t request for selfie, can they get your photo using your bvn?

  4. Adeyemi Adeshola

    please i was debit 3,925,60 2times on the 23d of June and one of the agent told me that they will reverse it back after seven working days since then have not been credited back. what should i do

      1. How long can a loan app continue to add interest on one’s loan untill the debt is eventually paid back?

        1. There is no limit, but most loan apps usually get tired and after a few months they usually will make you an offer to just repay the principal while they cancel all the interest. They will remove you from the blacklist but will ban you from getting further loans on their platform.

    1. No, they cannot come to your house to demand repayment. The highest they can do is to report your BVN and stop you from getting further loans from other loan apps.

    2. Tobiloba olaniyi

      After calls,messages,and threatening you many times can they ever forget the loan given to you??

    1. Funmilayo Adekanye

      How can I contact palm credit to remove my bvn or name from credit bureau after paying my overdue loan.

    1. No they cannot, the only thing they can do is to continue calling you and block your BVN from accessing further loans from other lenders.

  5. I have 3 questions
    1.if you deny their permission on your phone will they still have access to your contacts and all

    2.if you later pay them will they credit bureau grant you access to other loans in the future and will they let them know you have paid.
    Like will they notify them to

    3.will oweing them affect you from traveling out of the country

    1. 1. You can’t really deny them access to your contacts, you have to grant access to your contacts before they give you any loan. You can however give them fake contacts by changing or editing the numbers on your phone.

      2. If you repay, the credit bureaus will update your details, but some loan apps can still deny you loans due to your history. Credit bureaus automatically update records once you pay.

      3. Some embassies might run a financial background check on you to see if you have the money to support yourself when you travel. It depends on the country and reason why you are traveling.

          1. What if after i grant access to my fake contacts and after logging out of the app, I add my real contacts. Will it still be possible they access my contacts.

  6. If I take a loan and fail to pay back and then my BVN expires and I re enrol and update it. Will the loan apps still have my details and be able to reach me.

    1. BVN doesn’t expire, you can change minor details like name, address and phone number, but your BVN remains the same once your fingerprints have been captured.

  7. Azeez Barakat Oyinkansola

    I pay d sum of 67800 nd for me too request for another loan
    They show me 57200
    Which Dey didn’t increase my loan anymore

          1. So the likes of FCMB payday loan can’t access UBA account to recover outstanding loan?

          2. No, regulated banks can’t just take money out of your other bank account to cover their loans. They have to wait until you fund your account with them.

      1. iIs it all loan apps that copy and store ones contacts?And why are they not afraid of defaming people when they know it’s against the law?

        1. Most loan apps copy your contacts the moment you install them before they approve your loan. They are not afraid because they are unregistered loan sharks that cannot be tracked, most of them don’t even have any offices you can track them to.

  8. Can loan app I couldn’t make it to pay them arrest your friend in your contact and stop her from traveling out of Nigeria?

  9. I.borow loan from cashsea loan app, for 7day I told them I will pay back month end, them sending messages to my contact, now them my BVN, date of birth and phone number to. all my contact,

    1. Some of them that are registered with credit bureaus can. You should check your credit score with the credit bureaus to see which loan app have reported your loan default.

  10. Good morning sir…Can Renmoney visit ur house if you don’t pay your loan back ? And what they can do? Thank you

  11. Good afternoon Sir…. please If you don’t install loans app on your phone like Renmoney loan app but someone using your number with another phone they still have your contacts?

      1. Sorry for the question sir… When someone apply loans on Renmoney website not application but with your number on another phone they can have your contacts list ?

    1. loan apps cannot do anything to your bank account unless you bind your atm card then they can only auto-debit you. They cannot block your bank account.

      1. Please help me.
        When I wanted to borrow, I deactivated my Gmail acct where my contacts are. I borrowed with the acct where I just have random contacts. I dropped my real line as an alternative num and they have been threatening me on the whatsapp line. I hope they can’t have access to the contacts on the alternative whatsapp line.
        Note that when I wanted to borrow, those contacts were not on my phone. I just got them back .pls help.

  12. Sir thanks for your time. In the UK fianacial institute advice their citizens not to pay back loan apps if harassed, defame and call or message your contact. So why has Nigeria government not make such order knowing that these guys are illegal and they are not registered, license nor pay taxes. They sent messages to my contacts and even went on to call them. I have decided to pay back at my convince time . How do I contact credit bureau.

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