The Nigerian Government is planning to probe some digital loan apps over what has been described as alleged sharp practices and abuses.
The Committee on Banking and Currency, Financial Crimes and Telecommunications has been mandated by the House of Reps to commerce some investigations. This investigation is geared toward operations and loan administration of fintech companies and online digital loan apps in Nigeria.
Santomi noted the proliferation of online loan apps across Nigeria by “some fraudulent and unscrupulous profiteers affecting many low-income Nigerians. These set of people are forced to borrow and get trapped in the web of the sham loan apps hosted on Goggle Play Store by individuals and companies to swindle the low-income earners”.
In his words, he said;
“These predatory lending apps are disguised as platforms where unsuspecting members of the public are promised access quick loans with no collateral except the provision of bank verification number (BVN).”
“Such victims are expected to repay loans at astronomical interest rates within 3-7 days as against the 91 to 365 days claim on Google Play store which has over 83.07% market share in Nigeria.”
“Most of these loan apps or companies and individuals operate with no regulation by government, expired licenses and in some cases, no licensing.”
He ended by saying,
“The lawmaker expressed concern that searches for the registration status of loan apps in Nigeria from the Corporate Affairs Commission (CAC) show that founding directors of such apps or companies were foreign nationals without the required license to operate the volume of financial transactions and illegally operating in the country.”