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.
- 1 Can a loan app block my BVN?
- 2 What happens if I cant repay my online loans?
- 3 Can I go to Jail for not paying online loans?
- 4 Why do loan apps ask for BVN?
- 5 Are loan apps legal in Nigeria?
- 6 How do I block an online loan app?
- 7 Can loan apps access my contacts even after uninstall?
- 8 Which loan app has the lowest interest rate 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.
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.
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.