If you’ve ever borrowed money from a loan shark in Nigeria, you might understand how miserable these unprofessional lenders can make you feel for borrowing money. If you have never borrowed and are unaware of what they are, loan sharks are loan apps, digital platforms, online or offline lenders that offer loans at high interest rates with unprofessional terms of collection upon default. These include sending threatening, harassing, and defamatory texts to you and your contacts. They usually operate without a license or outside the law. Loan sharks essentially operate illegally and therefore cannot use the legal system to recover debts. They usually resort to threats of violence and blackmail to enforce repayment.
Loan sharks are called ‘loan sharks’ because they are like real life sharks; aggressive, angry, and greedy. A shark preys on smaller, vulnerable fish, just as a loan shark preys on people who are financially vulnerable.
Now you might ask, if loan sharks are so terrible, why do people still use them? – Loan sharks offer quick and instant cash to people with no collateral in Nigeria which can be a juicy proposition to the average Nigerian because of our standard of living and current economic situation. People also do not make their research before borrowing from loan sharks and become shark’s prey at the end.
In this article, we show you some popular Nigerian loan sharks, discuss how you can spot them, and the measures you can take to avoid them.
Loan Sharks in Nigeria
Loan apps have been on the rise in Nigeria. These apps offer collateral-free loans to people. This ought to be an excellent idea because of the difficulty and hindrances people have in accessing loans from banks. However, reverse is quite the case due to the aftermath of the loan borrowing process. Loan sharks have changed borrowing dynamics in Nigeria as these faceless apps flood Appstores and digital spaces.
These loan sharks disguise themselves by offering loan credit to people to be able to settle or cater for emergencies and swindle poor Nigerians of their hard-earned cash. A lot of borrowers online have shared the horrors of borrowing loans on these platforms. Popular loan sharks in Nigeria include SokoLoan, Kashkash, LCredit, 9Credit, iCredit, OKash, GoCash and a lot more others. You must’ve heard of one of these loan apps mentioned here. If you haven’t, consider yourself one of the top 10% elites in Nigeria.
How to Spot Loan Sharks
How do you spot loan sharks amidst legal moneylenders? Loan sharks won’t tell you they are loan sharks, and if you do not do proper research, you will fall prey. There are always pointers that differentiate the genuine from the fake. Here are a few things to watch out for:
- Loan sharks will request access to your contacts and pictures in your mobile phone, for which they will use to blackmail you in the case of a default. They use these details to invade your privacy and send you threats through text and calls.
- They offer high interest rates at with minimal repayment tenure sometimes as short as a week instead of the minimum of 60 days.
- Loan sharks are faceless with no verified owners, physical address, a poor and insecure website, or no website at all. Most times, they have no social media platforms, no contact telephone numbers, non-valid customer service support
- They create a sense of urgency and pressure you to acting immediately. Sometimes they are hidden charges and the interest is deducted before the loan is provided.
Visit Google Play Store or Apple App Store and check the reviews of people who have used the loan app previously. People who have had a terrible experience with them would have shared their experience with them.
Why You Should Not Borrow from Loan Sharks
If you still haven’t gotten the memo, I’m saying don’t borrow money from loan apps. We’ve discussed some of the ways to spot and avoid nigerian loan sharks. If you have a reasons to borrow money from a loan app, there are a hundred reasons not to. Let’s further discuss some of these reasons:
1. High-Interest rates
These platforms charge incredibly high-interest rates on their loans. Commercial banks in Nigeria charge an interest rate of 9% to 11.13% per year. However, these loan apps charge close to 20% to 35% weekly or monthly, depending on the plan you apply for. If you need a loan with a reasonable interest rate, come to OG Capital for hassle-free loan.
2. Access to your BVN
Many people don’t think twice before releasing their BVN details to loan app because they are desperate just to borrow the funds they need; they get carried away with the idea of a “collateral-free loan.” Financial institutions have always emphasized that you should not share your BVN details with unauthorized sources as they can be used for illegal and fraudulent activities. Because of your default in payment, these loan sharks can give your BVN details to the credit bureau to get it blacklisted, which can significantly harm you in accessing loans for huge business transactions later.
In the bid to recover their debts from their customers, loan sharks employ various means that are unprofessional, unethical and illegal, such as defamation, harassment, shaming and intimidation, regardless of the reason for the default. If you default you will be humiliated, defamatory messages will be sent to your contacts and your integrity will be ruined. The struggle and shame that come with harassment from loan sharks has pushed some people to the brink of suicide. You don’t want to be in that scenario.
Since loans sharks are so easily accessible with little criteria, they become very attractive to the average person. Once a loan has been given, most people are unable to pay back these loans within the given time and have to depend on another loan shark to pay back. This increases the tendency to be addicted to borrowing from various platforms and continue this borrowing loop. This can devastate your personal finances, your integrity, self-esteem, and ultimately, your life.
Don’t borrow money from loan apps. Their interest rates are ridiculously high, they falsely accuse you and your associates of criminal behavior, their agents are faceless rogues who will blackmail you. They use your confidential information to extort you and tarnish your image. The government and financial institutions have strongly advised against getting loans from these unauthorized loan apps. The Federal Competition and Consumer Protection Commission (FCCPC) are actively working to freeze the operation of loan apps in Nigeria.
You might have legitimate reasons for getting the loan. However, it is never advisable to borrow funds from a loan shark. It is a ‘from frying pan to fire’ situation. Loan sharks who offer loans can get you into more distress than you were before getting the loan. What we’ve discussed so far are the ways to spot and avoid nigerian loan sharks.
If you need a business loan, OG Capital is your surest plug to a secure, hassle free, and low-interest loan.
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Hi there! I’m Owen, a writer, designer, and a digital marketer. I create and manage content at OG Capital. I am a highly motivated individual who is very passionate about problem-solving. Reach out to me on social media and I will be more than happy to connect with you. Cheers!