What exactly is the Nigerian Government Student Loan?

The Student Loan Initiative is a program established by the Federal Government of Nigeria to break financial barriers in higher education through the provision of interest-free loans to students.

With that being said, it is good to know what exactly it is all about before deepening your legs in it. You might start wondering if it is not another PalmPay loan or loan shark. You might even have fear for the Nigerian government (fear of being lied to). All those fears will be sorted out in this guide; just read and share.

What is Nigerian Government Student Loan?

The Nigerian government’s student loan is your key to unlocking your educational dreams. This program provides financial support for public universities, polytechnics, colleges of education, and even technical or vocational training! It covers tuition, fees, and living expenses; all you need to focus on is acing those courses of yours. Go for NYSC and get a better paying job.

Under the newly revised Student Loan Act, the Nigeria Education Loan Fund (NELFUND), a corporate body setup by the Federal Government, will be responsible for the disbursement and management of the student loan (with some other government bodies like the FIRS).

Under the same revised student loan act, you will NOT need to provide two guarantors, which include civil servants with at least 12 years of experience, lawyers with at least 10 years of experience after qualifying, judicial officers, and justices of the peace.

Also, under the same revised student loan act of 2024, family income will no longer be a prerequisite for eligibility for the student loan. 

Below is the full revised Student Loan Act of 2024.

10 Key Points About the Revised 2024 Student Loan Act in Nigeria:

1. NELFUND Established: A dedicated Nigerian Education Loan Fund is created to manage student loans. NELFUND is headed by Mr. Akintunde Sawyerr as Managing Director/CEO, Mr. Frederick Oluwafemi Akinfala as Executive Director, Finance and Administration, and Mr. Mustapha Iyal as Executive Director, Operations
2. Loan Coverage Expanded: Financial support goes beyond tuition to include fees, charges, and living expenses.
3. NELFUND Funding Secured: A dedicated source of funding is established from federal tax collections. The student loan program will be financed by allocating 1% of all taxes, levies, and duties that the Federal Inland Revenue Service (FIRS) collects and that go to the Federal Government, directing these funds to a General Reserve Fund. 
4. Family Income No Longer a Barrier: Students from all income backgrounds can now apply.
5. Guarantor Requirement Removed: There is no need for guarantors to qualify for a loan.
6. Skills Training Included: Funding is available for vocational and technical training programs.
7. Parental Loan History Disregarded: Parents’ loan history won’t affect student eligibility.
8. Repayment Starts After NYSC: Focus on education first, then repayment begins two years after service.
9. Penalties for False Information: Providing false information to secure a loan comes with legal consequences.
10. Debt Forgiveness Clause: Loan forgiveness is possible in cases of death or unforeseen circumstances.

Who can Apply for the Federal Government Student Loan?

• Admitted to a Nigerian university, polytechnic, college of education or vocational school (public only)
• Must not have defaulted on any previous loans or been found guilty of any examination malpractice, felony, or drug offenses.

Who cannot Apply?

Below are people who cannot apply for the Federal Government Student Loan:

• Defaulted on a previous loan
• Found guilty of cheating on a school exam
• Convicted of a felony, dishonesty, fraud, or drug offense
• If your parent(s) defaulted on a student loan

How to Apply

Step 1

Register on the Student Loan Application Platform by clicking the “APPLY NOW” button to get started.

Step 2

Proceed to your student loan application, select either tuition/institutional fee, upkeep or both.

Step 3

Your student loan gets approved and disbursed into your school account in minutes.

To get started:

1. Visit https://slas.omniswift.com/auth/welcome or https://nelf.gov.ng
   Click on ‘Get Started‘
2. Next screen, answer the questions about yourself:
   N.I.N.,
   Date of Birth
   Surname
3. Verify your student status, using:
   JAMB Registration Number or BIMs Registration No. (Beneficiary Identity Management Service)

Keep the below details:

1. A cover letter from your school signed by important officials.
2. Attach required documents:
   • copy of your admission letter
   • Guarantor letters recommending you for the loan and agreeing to repay if you don’t
   • Two passport photos from each guarantor
   • Proof of guarantors’ employment (letter and information)
   • If guarantors are self-employed, provide business registration details

Required Documents

1. A completed application form
2. A copy of your admission letter
3. A copy of your JAMB result slip
4. A copy of your WAEC/NECO result certificate
5. A copy of your birth certificate
6. A copy of your passport photograph
7. A guarantor’s letter of support from each of your two guarantors
8. A copy of your guarantors’ employment letter(s)
9. A copy of your guarantor’s passport photographs

After You Apply

• The approval process is instant if you are eligible, and your details are correct and valid.

Repaying the Loan

• You don’t have to start paying back until two years after finishing your National Youth Service Corps program.
• Payments will be automatically deducted from your salary (10% of your salary).
• If you are self-employed, you will need to send 10% of your monthly profit to the loan program.
• There are penalties for not repaying the loan.

NOTE: After you follow the above process, the final decision lies with NELFUND.

Frequently asked questions about the Federal Government Student Loan in Nigeria

Who is eligible to apply for the student loan?

Eligibility is based on specific criteria, including admission to a recognised institution (have an active academic profile), a valid BVN (Bank Verification Number) and NIN (National Identity Number), and a valid Jamb record.

What documents are required for the application?

You will need your Admission letter and Student ID Card (optional)

How long does the approval process take?

The approval process is instant if you are eligible, and your details are correct and valid.

Can I apply for living expenses in addition to tuition fees?

Yes, you can apply for an upkeep loan in addition to the institutional fee.

When should I start repaying my loan?

Repayment of your loan starts 2 years after your NYSC and will be deducted automatically from your bank account.

Is there a grace period after graduation?

Yes, you have a 2-year grace period after your NYSC.

What is the maximum loan amount a student can receive?

The maximum loan amount is outlined in the Student Loan Act. It is subject to periodic review by the Special Committee.

Can I apply for multiple loans under this initiative?

Eligible students can apply for upkeep and tuition loans but there is only one application for each loan type.

How does the interest-free aspect of the loan work?

Interest-free means that you will not be charged additional fees or interest on the loan amount. You will only repay the principal amount borrowed.

Can I use the loan for expenses other than tuition fees?

Yes, the loan can cover additional expenses such as living costs (upkeep), as specified in the Student Loan Act.

Can parents apply for a loan on behalf of their child?

No, parents cannot. Eligible students must apply for the loan themselves in accordance with the eligibility criteria outlined in the Student Loan Act. However, parents may act as guarantors if required.

Are there any penalties for early repayment of the loan?

No, there are no penalties for early repayment. In fact, early repayment is encouraged as it helps reduce the overall financial burden.

How are loan repayments made?

Repayments are facilitated through salary deductions arranged with employers. The Nigerian Education Loan Fund coordinates with employers to ensure seamless repayments.

How do I become a guarantor for a student applying for a loan?

You can become a guarantor by providing a letter of recommendation and agreeing to accept liability in case the student is unable to repay the loan.

Can a guarantor be changed after the loan has been approved?

In exceptional cases, a guarantor may be changed, but it would require approval from the Nigerian Education Loan Fund and should be communicated promptly.

Can a parent apply as a guarantor for multiple children simultaneously?

Yes, a parent can act as a guarantor for multiple children, provided they meet the criteria outlined in the Student Loan Act.

Can parents receive updates on the loan status and repayment process of their child?

Yes, parents can request updates from the Nigerian Education Loan Fund regarding the loan status and repayment progress of their child.

Can parents serve as guarantors if they are not Nigerian citizens?

The Student Loan Act specifies that guarantors must be Nigerian citizens, so parents who are not Nigerian citizens would not be eligible to serve as guarantors.

Are there any provisions for loan forgiveness in certain cases?

The Student Loan Act outlines specific circumstances under which loan forgiveness may be considered, such as in cases of permanent disability or death.

How is the effectiveness and impact of the initiative assessed and reported to the public?

The Student Loan Act requires the Nigerian Education Loan Fund to provide regular reports and updates on the initiative’s progress.

Can a guarantor withdraw their support after the loan has been approved?

While possible in exceptional cases, it would require careful consideration and adherence to the processes outlined in the Student Loan Act.

What happens if a student changes their course or institution after receiving the loan?

Changes in course or institution must be communicated to the Nigerian Education Loan Fund for evaluation and approval, as outlined in the Student Loan Act.

How is the Student Loan Initiative funded?

The initiative is funded through government allocations, grants, and contributions from various stakeholders, as outlined in the Student Loan Act.

The post Federal Government Student Loan in Nigeria: How to Apply Easily appeared first on AFRICA EXPLAINED.

Tired of watching inflation eat away at your cash? It’s time to put your money to work! This guide explores the top high-interest savings options in Nigeria, helping you choose the best fit for your financial goals.

Traditional vs. Modern: Weighing Your Options

Gone are the days of settling for meager returns. Today, two distinct avenues offer attractive interest rates:

• Brick-and-Mortar Banks: Established players like Fidelity, Access, and UBA provide stability and familiarity, but their interest rates typically hover around 1-3%.
• Fintech Apps: Piggyvest, Cowrywise, and Alat by Wema offer digital convenience and significantly higher rates, reaching up to 18%. However, these are relatively new players, and some might prefer the established trust of traditional banks.

Considering Your Needs:

Before diving in, ask yourself:

• What’s my goal? Short-term savings for emergencies? Long-term goals like a house or retirement? Different options cater to different needs.
• Accessibility: Do I need easy access to my funds, or am I comfortable locking them away for higher returns?
• Risk Tolerance: Traditional banks offer lower risk but lower returns. Fintech apps offer higher potential rewards but may be perceived as slightly riskier.

Top Fintech Apps:

• Piggyvest: Flexible savings options, up to 13% interest, automatic savings tools.
• Cowrywise: Short-term and long-term plans, emergency savings, up to 12% interest, mutual fund investment options.
• Alat by Wema: Flexible and goal-oriented savings, up to 10% interest, money management tools.
• FairMoney: Two options: FairSave (flexible, 10% interest) and FairLock (fixed deposit, up to 18% interest).
• Kuda Bank: Flexible and fixed-term savings, up to 10% interest, easy transfers.

Remember: While these apps are regulated, they are still relatively new. Consider your comfort level with their track record.

Traditional Bank Options:

If you prefer established institutions, consider these high-yield savings accounts:

• Fidelity Bank HYSA: Up to 3.3% interest, tiered based on balance, bonus for low withdrawals.
• Access Bank HIDA: Up to 2.5% interest, tiered based on balance, free withdrawals within limits.
• UBA Target Account: Up to 1.20% interest, tiered based on balance, minimum opening balance required.
• GTBank Target Savings: Up to 1.15% interest, bonus for standing orders, non-transactional account.
• Polaris Bank – Polaris Wise: Up to 2% interest, tiered based on balance, debit card and cheque book options.
• Standard Chartered Bank – eSaver: Up to 1.25% interest, free monthly statements and online access.
• Sterling Bank – SRDA: Up to 2% interest, goal-oriented, minimum monthly deposit required.

Wrapping Up:

The best high-interest savings account depends on your individual needs and preferences. Weigh the pros and cons of each option, considering factors like interest rates, accessibility, and risk tolerance. By making an informed decision, you can watch your Naira grow and achieve your financial goals!

Bonus Tip: Regularly compare rates and features to ensure you’re getting the best deal. Remember, the financial landscape evolves constantly, so staying informed is key!

The post Grow Your Money in Nigeria: Top Savings Accounts to Open in 2025 appeared first on AFRICA EXPLAINED.

However, Nigerians are beginning to ask if the new banknotes have already been counterfeited. This is coming after a viral social media post purports to show what was allegedly fake 1,000 naira notes of the recently released bank notes received by a Point of Sale (PoS) operator.

The post showed the alleged fake notes alongside original notes for people to tell the difference.

All these is happening barely four days after the Central Bank of Nigeria, (CBN) began roll out the newly redesign naira notes on 15 December, 2022.

How to know the difference between original and fake naira notes

The new Naira banknotes are protected by a number of security features to make it easier to spot fake from the original note.

Central Bank of Nigeria explained on their website that people can tell the original naira notes when they touch and see it through the raised print, security thread and watermark.

CBN said the raised prints provide tactility, (that means the ability to feel it embossed when touched).

There is also a windowed metallic thread that reads “CBN” when placed in front of light.

The CBN said other features to identify the original notes include the portrait, lettering and the denominational numerals (that is the naira value) at the front and back of the money are printed boldly and embossed from the surface.

The Central bank of Nigeria also say the new Naira notes are protected against photocopying.

The original naira has features that are visible under ultraviolet light; for example, the serial number on each banknote is black, but would turn green under ultraviolet light.

These features highlighted by the CBN is not in the fake or counterfeit naira notes.

According to the Central Bank of Nigeria it is unlikely for fraudsters that counterfeit money to get full knowledge of all security features.

This is as the CBN is constantly upgrading the banknotes with state of the art security features to stay ahead of counterfeiters.

The post How to identify fake new naira notes appeared first on AFRICA EXPLAINED.

This came after a Federal High Court sitting in Abuja reportedly declined the secret police’s application to issue an arrest warrant for the CBN governor.

Justice J.T. Tsoho, who declined to grant the ex parte motion which sought to arrest Emefiele, was reported to have said that the DSS did not provide any concrete evidence to substantiate its claims that Emefiele was involved in terrorism financing and economic crimes.

According to Punch, the judge who refused to grant the DSS request said, ‘’In the light of the foregoing reasons, I decline to grant this application ex parte. If the applicant believes that the evidence available to it so far is sufficient, then it can as well arrest and detain the applicant, even without the order of the court. If however, the applicant desires to still pursue this application, then it should place the respondent on notice considering the sensitive public office that he occupies.”

Meanwhile, there are reports that the judge was uncomfortable with the fact that the application by the DSS to arrest the CBN Governor was not accompanied by presidential approval despite the sensitive nature of the matter and its grave implications for the Nigerian economy.

Naira redesign

The recent travails of Emefiele might be political, likely the consequence of his decision to redesign the country’s three largest denomination banknotes. The CBN governor has also introduced a new cashless policy that will limit the amount of cash Nigerians can withdraw. All of these coming months before the 2023 general elections will impact politicians who rely on vote buying to win elections.

Earlier, there had been reports of a huge protest of people numbering over 200 who stormed a Federal High Court in Abuja following a reported suit secretly filed by the DSS, accusing the CBN Governor, Godwin Emefiele, of terrorism financing and other crimes.

The group of civil society organizations had raised alarm over an alleged plot to frame Emefiele for terrorism and remove him from office.

The protesters, who carried placards with various inscriptions, also alleged that the DSS embarked on the plot to remove the CBN governor for political and pecuniary reasons.

The DSS reaction

Meanwhile, the DSS in its reaction to the recent protests by some groups, stated that it would not join issues with those protesting the suit filed against the CBN governor, saying they were on a wild goose chase.

The secret police warned Nigerians against being used as instruments of destabilization, saying that the service will not be distracted by those seeking to use “propaganda” to undermine its lawful investigations.

The DSS in a press release by its spokesman, Peter Afunanya, maintained that it remains focused and unbiased and would not succumb to propaganda, intimidation and the desperation of hirelings to undermine it.

• Afunanya in the statement said, ‘’As such, the Service will continue to disseminate actionable intelligence to the relevant authorities devoid of any sentiment
• “While professionally discharging its mandate, the DSS pledges to. It will also not give room to the use of falsehood and deceit to misdirect public understanding and perceptions of issues of national importance.
• “It will also not give room to the use of falsehood and deceit to misdirect public understanding and perceptions of issues of national importance.
• ”The service warned those on a wild goose chase to be mindful of their actions. Similarly, it urges members of the public to disregard the vituperations and rantings of misguided elements and not allow themselves to be used as instruments of destabilization.”

The post Why the DSS wanted to arrest CBN governor, Godwin Emefiele appeared first on AFRICA EXPLAINED.

The CBN is a government institution with all its functions enshrined in the constitution. To fully understand what the CBN is, it is important to understand what it isn’t. Unlike most financial institutions that are profit driven, the apex bank does not seek to make profits, rather its budget is from a government grant determined by parliament.

New CBN cashless policy

As a part of its responsibility of setting the monetary policies in Nigeria, starting from 2023 the apex bank has announced that it would be more stringent for Nigerians to access cash, the plan is for the majority of transactions performed in the country to be digital. The main reason for this is that the CBN said cash in circulation in Nigeria is now over 50 trillion Naira and it cannot account for most of it. But where is all this money coming from if the CBN does not have control over such a huge sum of money?

Intervention loans: Part of the money in circulation in Nigeria is coming from the CBN itself in terms of intervention loans it routinely gives to stimulate the economy. Loans such as the NIRSAL loans given to farmers and small scale entrepreneurs to mitigate the effects of Covid means plenty of money pumped into the economy.

Counterfeited cash: Cash counterfeiting by criminals is a huge problem in most economies. Criminals can print large sums of money and spend it on unsuspecting members of the public, thereby tainting legitimate financial institutions. Counterfeiting is one of the main reasons why the CBN is redesigning some of the country’s naira notes to render previously hoarded and counterfeited notes useless.

Remittances: When people living abroad send money home, but the money was not remitted through a CBN-licensed remitter, such funds can become very hard for the CBN to account for. Peer-to-peer platforms and cryptos are some of the most difficult transactions for the CBN to track. People use unlicensed remitters for a variety of reasons including cheaper fees or illegal transactions.

Why the CBN wants to implement the cashless policy

Having too much cash flowing around in the economy without control is bad. Criminals like armed robbers and kidnappers rely heavily on cash, without which they will find it more difficult to extort their victims.

Tight control of the money in circulation will also enable the CBN to plan and control inflation.

FAQs

Here are some general FAQs on the activities of the CBN.

The post Central Bank of Nigeria CBN, Explained appeared first on AFRICA EXPLAINED.

If you’re having trouble maintaining financial discipline and are looking for help in becoming a better saver, here are some tips on how to set saving goals.

1. Properly define your savings goals

As the saying goes, a well-defined problem is already half-solved. Rather than just saving without a specific purpose, decide what you’re working toward, whether it’s a vacation, a university education for your kids, a down payment on a house or retirement.

Have the emotional conversation with yourself about your money and what you hope it accomplishes. It is not enough to only have a vague idea of “saving more.”

2. Set a savings deadline

You will also need a well defined timeline on when you will like to have accomplished your goals.

Some goals, like buying a car next year, might be shorter term. Other goals, like reaching your retirement number, might take longer and require more ongoing planning.

If you know you need #1,000,000 to buy a car next year, you may need to set aside #83,000 a month for the next 12 months. For retirement, you can use a calculator to estimate how much you need to invest to hit your retirement savings goals.

3. Create a different account for each goal

It is far more likely than not that you will be saving for more than one goal at the same time, this is why it is important to have different accounts for different goals for clarity.

Break down each savings goal into an account, whether it’s for a car, house, vacation or anything else. That way, you can decide how to divide your resources into the accounts based on your savings timeline and the amount you need to reach your goals.

An app like Piggyvest allows you to do this from the comfort of your home without having to visit the banks and fill out multiple forms.

4. Track your goals

Keep track of your progress so that you can see where you stand and celebrate your progress. As you see your success, you’re more likely to feel good about continuing. And, of course, once you reach your goal, that feeling can encourage you to keep working toward your other goals — and setting new goals.

The most difficult part is starting, but once you get the ball rolling, saving money can become addictive.

5. Break your goals down into smaller chunks

Breaking your goals down into as smaller units as possible can make you feel more empowered to reach them faster.

If you plan to buy a #5m car in 12 months, you need to set aside around #40k each month. For some savers, though, that can feel like a daunting task. Breaking that down into a weekly contribution of around #10k may make it seem more manageable, and you can look for ways to cut back on your spending to hit that target.

Identify where and how you’re spending money in a way that isn’t serving you, with that knowledge, you can take different actions to find the money you need to meet your goal.

6. Automate your goals

Rather than trying to remember to set aside money for a goal, consider setting up automatic transfers and deductions. You can create automatic transfers on your bank apps, or on savings apps like Piggyvest and Kuda to occur on the same day each week or month, creating a situation where you don’t have to remember to make the move and take a separate action.

Automatically moving the money helps it stay out of sight so you don’t spend it.

Bottomline

Saving money is the bedrock of building a financially stable life. But it takes discipline to get started and continue with it in the long run.

The post How to meet your savings goals appeared first on AFRICA EXPLAINED.

Life is unpredictable, and it is very much possible to find yourself in a situation where everything can seem to be going hunky-dory – then, out of the blues, the car malfunctions and requires a complete overhaul. Or a loved one needs major surgery immediately – and, horror of horrors, you don’t have the necessary funds available at the moment.

Here are 5 alternatives to consider before you call that predatory lender for one of his short-term loans.

Friends and Family: the best alternatives to short-term online loan apps!
 

Okay, we understand that you don’t want people up in your business, but, come on, friends and family should be your first port of call for emergencies! Apart from the fact that they care about you, borrowing short-term loans from them is the least expensive of all other alternatives. Neither will they publicly embarrass you if you default…hopefully.
 

When you borrow from them, ensure you protect the relationship. First, borrow only what you need and – without being asked! – provide an IOU showing how much was lent, the repayment plans, and the time frame for full payment. If possible, provide proof of expenses made – but most importantly, pay them back, no matter what else you might be experiencing. Don’t damage your relationship.

Credit cards.
 

You can get credit cards to make payments or purchases. Personal short-term loans give you a lump sum, but alternative credit cards give you an amount of credit within a specified limit that you can use. You can pay back your debt little by little or all at once. If you are paying in instalments, you can pay as much of your debt as you like – as long as you make the monthly minimum payment. Better still, if you can pay up all your balance within a month, there will be no interest charges for you.
 

However, you must decide if a credit card is good for you. If you prefer the liberty of offsetting your debt in monthly instalment payments, go ahead. Even so, you would need to have a sure-proof repayment plan to avoid paying unnecessarily huge interest.

 

Cosigner or Guarantor loans.
 

This alternative to regular short-term loans is a big deal because it is based on trust. It allows you to borrow using the good credit of someone close – usually friends or family. When that person cosigns with you, it means they are agreeing to take responsibility if you fail to repay. Heavy, right?
 

When you apply for a cosigner or guarantor loan, the lender looks at the credit histories of both parties. If your cosigner or guarantor has good credit, it makes the release of funds easier because the lenders know they can go after your guarantor if you default.
 

Just like family and friends, don’t damage this relationship. Don’t allow the lender to contact your cosigner for any reason. Always pay promptly – and try to clear the loan as quickly as you can.

 

Salary advances.
 

Do you know that you can request for a part of your “future” salary from your employer? Yes, you can ask for a loan or salary advance to offset urgent expenses, instead of borrowing from traditional lenders.

A major plus about this is that you don’t pay interest on the loan. Instead, you pay back in direct instalments or through deductions from upcoming pay-checks. 
A downside is that employers approve these loans on a case-by-case basis. So, if your case is not deemed important for a loan, you can be refused.

If this occurs, another alternative is pay-check advance apps that offer emergency loans to salary earners and are safer than traditional short-term loans. You could explore that as well.

 

Overdrafts.

This option is for those with functional current accounts. If you don’t have one, get one – and get one that offers overdrafts as part of the account. If you already have a current account, you can simply – and quickly – apply for your account to have an overdraft. Yes, using an overdraft will cost a fee, but it is almost nothing when compared to a short-term loan.

So, instead of rushing to borrow that loan from a short-term lender, why don’t you try out some of these alternatives first?

The post Five Alternatives To Short-Term Online Loan Apps appeared first on AFRICA EXPLAINED.

The high volatility started when the CBN announced that the country’s 200, 500 and 1000 naira notes will be redesigned in December with all old notes becoming obsolete by January 31, 2023. Panic buying of the dollar followed which pushed the price to almost #900/$, but that trend was halted when the EFCC went after BDC merchants, accusing them of helping politically exposed persons launder their money.

Other factors also came together within a week, all of which helped the naira regain its strength against the dollar.

Trading at the official CBN window

• The exchange rate at the official market closed at N446/$1 on Tuesday, 15th November 2022. This represents a slight depreciation of 0.06% in comparison to N445.75/$1 recorded on the previous trading day.
• The opening indicative rate closed at N444.4211 on Monday, 14th November 2022.
• Furthermore, an exchange rate of N447/$1 was the highest rate recorded during intra-day trading before it settled at N446/$1, while it traded as low as N439.33/$1 during intra-day trading.
• A total of $63.83 million in FX value was traded at the Investors and Exporters window on Monday, which is 74.98% lower than the $255.15 million traded on Friday.

The post Aboki Black Market Dollar to Naira Exchange Rate Today, November 16 appeared first on AFRICA EXPLAINED.

The number is connected to your biometric data – which means every Nigerian only has one and the number can be used to identify and secure every transaction performed in the country. As important as this number is, some citizens can run into trouble with theirs, either as a result of some of their actions or through no fault of theirs – their BVN can be blacklisted.

A BVN blacklist is a database of Nigerians who have committed some financial wrong-doings and are now deemed as high-risk individuals that can prevent them from getting a loan, job or even traveling abroad. When a person’s name is on the blacklist, it usually means that they have defaulted in repaying their loans. But there are other actions that can land an individual on the blacklist as well.

Actions that can land you on the BVN blacklist in Nigeria

Loan default: The most popular reason why people get on the blacklist is when they defaulted in repayment to their creditor within the stipulated period. Even if you pay back days or weeks after your tenor has expired, it can still negatively affect your credit score and can land you on the blacklist.

Issuing a dud cheque: Issuing a dud cheque on your account can get you into trouble. Not only will it land you on the BVN blacklist but it can also get you arrested and prosecuted by the police. Issuing a cheque that you know will bounce due to insufficient balance in your bank account is simply a bad idea.

Standing as guarantor to a defaulter: Standing as a guarantor to someone unable to repay their loans can also affect you negatively. You as the guarantor might be held liable and unable to secure a loan until they clear their outstanding. Do not stand as a guarantor to anyone you’re not absolutely sure can repay their debt obligations.

Effects of BVN blacklist

Your BVN is perhaps one of the most important financial documents in Nigeria and if it is compromised, that can lead to some dire consequences including but not limited to;

Unable to secure a loan: The most immediate consequence of being on the BVN blacklist is that defaulters will be unable to secure further credits. Most reputable lenders do run a background check on their potential customers to see their credit score. Individuals with outstanding loans usually get rejected during this process.

Unable to get jobs: Some employers do check the credit history of their potential employees, most especially banks and other financial institutions will not consider people with negative credit for employment. These checks are usually done in the background without telling the applicant, applicants with negative credit will just be getting rejected without being informed of the reason why.

Unable to travel abroad: As getting a visa to travel abroad is becoming more and more stringent, some embassies now include credit history as part of their background check. Embassies prefer immigrants that can handle their financial responsibilities so that they don’t become a burden after travelling. If you are heavily indebted your visa application might not go smoothly until you clear your record.

Unable to secure some government deals: Certain government deals like a job with the Nigerian Intelligence Agency or even the CBN might require applicants to have a spotless credit history. Point is, having your BVN is bad and can deny you plenty of opportunities. Luckily, there is a way to remove your name from the blacklist even if you are on it.

Steps to remove your BVN from credit bureau blacklist

Request your credit report: You can request your free credit report from any of the credit reporting agencies in Nigeria. We recommend you use CreditConnection – their service is free and seamless. getting a credit report will enable you to see which institutions you are owing to and keep track of your loans. Note that loans from loansharks and other online loan apps might not appear here if they are unregulated.

Pay your debt: The next step in clearing your name from being reported as a defaulter is to pay up what you owe. If you are in a financially difficult situation, ensure you contact your lender to discuss payment options that could ease the burden of paying the loan. Choose a payment plan that will work best for you and follow up until you settle your debt. You can also set up automatic payments on the due date to avoid missing a payment. 

clearance certificate/letter of non-indebtedness: Should you have a clearance certificate/letter of non-indebtedness, you can forward the letter to the credit bureau for verification from your lender.

Contact Credit Bureau: After clearing your debt, your lender is obliged to contact the credit bureau and update your records, but this can sometimes not be done as the process is usually automated.

However, you may apply to the credit bureau where you were listed to have your credit profile updated. This can be done by contacting the Bureau via phone/email.

Helpdesk: https://helpdesk.creditreferencenigeria.net/

Email: support@crccreditbureau.com

Phone line: +234-807-209-0622

Your email should carry the following details; your Full Name, Phone Number, Bank Verification Number (BVN), gender, evidence of payment and Clearance certificates (if any).

This process might take 2-5 working days to be resolved so do not hesitate to follow up with the Credit Bureau.

list of licensed credit bureaus in Nigeria

A Credit Bureau is a private company licensed by the CBN to keep a database of how individuals and businesses handle their debt obligations. They keep a record of how much loan is being taken and how soon or late the loan is being paid back in other to protect creditors from loan defaulters. Here are the three main credit bureau agencies licensed to operate in Nigeria and their website.

• CreditConnection
• CRC Credit Bureau Limited
• FirstCentral Credit Bureau

You can get your free credit report from any of the above. The CBN does not keep a record of credit reports of Nigerians but outsources it to these private companies who can show you yours for a fee.

FAQ

The post How to Remove Your BVN From Credit Bureau Blacklist appeared first on AFRICA EXPLAINED.

But analysts say these gains may not hold up for long, and we might even begin to see a reverse any time from now.

To understand why it is important to understand how the parallel market works and how the exchange rate is determined in the black market.

The black market rate in Nigeria is determined by market sentiment of supply and demand, if plenty of people are demanding the dollar, the price goes up and vice versa. The market in recent days has seen a surge in dollar supply is the reason why the exchange rate is falling now, here’s how.

Reasons for the crash

EFCC raid on BDCs

Throughout last week, EFCC officials raided the offices of bureau de change merchants in Abuja, Lagos, Kano and other major cities over allegations of currency hoarding and helping politically exposed persons to exchange their naira for dollars before the January 31, 2023 deadline when the CBN said old naira banknotes will cease to become legal tender in the country.

These raids forced most of the BDC operators to go underground, this move forced politically exposed persons to hold back their demands for the greenback. The huge demand that pushed up the exchange rate disappeared almost instantly.

Expiring dollar bill rumour

Following the announcement that the CBN has concluded plans to phase out the country’s 200, 500 and 1000 naira banknotes by January 31, 2023. Some people began peddling the rumour that the US Federal Reserve is planning a similar move with the dollar.

These unfounded rumours caused panic in the market with people who have the greenback selling before any possible expiration date. Though the rumour was false, it caused the market to be flooded with dollars in a very short period

Crash in the crypto market

Earlier this week, Binance, the world’s largest cryptocurrency exchange, backed out of its decision to purchase faltering cryptocurrency exchange FTX.COM.

Binance said the decision to pull out of the deal was as a result of corporate due diligence and information that regulators were investigating issues of mishandling of investor funds.

This news led to a bloodbath in the crypto market. Bitcoin prices fell 15% to $15.7k on Wednesday as investors liquidated millions of tokens in investments. A total of $200 billion was reportedly wiped off crypto markets within the week.

Nigerians are among the largest crypto holders in the world, and the rush to liquidate tokens meant millions of dollars came into the country as holders try to cut their losses.

BRICS attempt to replace the dollar

The US dollar is the world’s reserve currency, and about 65% of global trade is performed in dollars. But countries in the BRICS organization comprising Brazil, Russia, India, China and South Africa announced that they plan to develop a new currency that will replace the dollar in global trade.

This news is also affecting the confidence that people have in the US dollar remaining the world’s reserve currency in the long term.

Bottomline

A combination of factors both local and international have helped the naira make some gains against the dollar in the black market. But these gains might not hold for long as the underlying factors that weakens the naira are still there.

The fact that Nigeria imports almost everything and doesn’t export anything valuable. Nigerians still spend over $ 1 billion on medical tourism every year. Thousands of Nigerians still leave the country every year due to rampant insecurity and to seek greener pastures abroad. Unless these factors are addressed, the naira to dollar exchange rate might sink to #1000/$ soon.

The post Why Naira to Dollar Exchange Rate is Crashing at the Black Market appeared first on AFRICA EXPLAINED.