THE Federal Government is exploring avenues to probe some digital loan apps over what has been described as alleged sharp practices and abuses.
The House of Representatives has mandated its Committee on Banking and Currency, Financial Crimes and Telecommunications to commence investigation into operations and loan administration of the fintech companies and online mobile digital loan apps in Nigeria.
The resolution followed the consideration of a motion under matters of urgent public importance titled “Need to Investigate Sharp Practices By Unregulated Online Fintech Lending Companies and Abuse of Mobile Digital Loan Apps in Nigeria”, moved at the plenary by Hon. Ahmed Satomi from Borno state.
According to the motion, these unregulated Nigerian fintech companies shame, threaten customers for late payment of loans; Cognizance of the need to investigate activities these fintech companies including OKash, Opay, PayLater, PalmCredit, Branch, QuickCheck, Aella Credit, FairMoney, KiaKia, EasyCredit, NewCredit, Umba, Carbon, and FirstNell.
Others include; SoftNaira, SharpCash, Newcredit, Cash Mall, NairaLand, Naira9ja, New Credit Loan App, Future Cash, SharpCredit, MoneyHub, 9jaCash, Henloan, Get Loan, Plenty Cash, Fundy, iMoneyPlus, CashCredit, LifeLine, Lumos Loan, NairaPlus, Care Finance, Cashbean, CashMe, LoanMe, LifePurse iLoanPro, LairaPlus, OxLoan and NoNowMoney, among others.
Presenting the motion, Satomi noted the proliferation of online loan apps across Nigeria by “some fraudulent and unscrupulous profiteers affecting many low income Nigerians, who are coerced to borrow and get trapped in the web of sham loan apps hosted on Google Play Store by individuals and companies to swindle the low-income earners”.
He said they the COVID-19 pandemic affected many economies including Nigeria as jobs were lost and incomes were affected, due to the lockdowns, restrictions on movement and face-to-face interactions sped up the pace of digitalisation of financial services and the infiltration of some unscrupulous unregulated financial service operators.
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 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.”
