By Bankole Abe and Omolola Pedro
DEBT collectors for many loan apps in Nigeria exploit unconventional techniques to shame defaulting borrowers to retrieve loans.
This has been the subject of discourse and multiple media reports. Some people who borrowed money from loan apps have come together to form groups on Facebook to seek retribution.
One of such pages is the Mobile Loan Apps Debts Victims in Nigeria. One of the admins of the page told The ICIR in a chat that the purpose of the group is to support each other against debt collectors that harass them with calls and messages.
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The page has messages that encourage people to collect loans from ‘illegal loan’ apps and not pay them back. It also claims to enlighten the public about the loans.
One of such messages reads: “If any loan app shares what transpires between you and them with a third party, automatically you have repaid that loan!”
Another post stated, “you can never be the one at wrong against 14/7 days loan tenor. As long as it’s such a short tenor with an interest higher than what CBN has laid down as guidelines, such loan apps will always be the one on the wrong whether you are indebted to them or not!”
It went further to state that “If the loan apps will not stop operating illegally in our country, then why should they not be given a lesson of their life? Please stop telling people not to take loans abeg”.
It further added: “This is an anti-loan apps platform please, where we give no slightest consideration to mobile loan apps. Na their destruction be our own happiness. We can’t wait to see them fall!”
The admin who spoke to The ICIR noted that she is using a pseudo name.
A similar group on Facebook with over 20,000 members is called Say No to Sokoloan, LCredit ETC. It also has a Telegram channel. This group states that they provide psychological support for victims of loan app harassment.
To be a member, you will be asked numerous questions which include: if you are a loan app defaulter. Other questions are: ‘Are you a loan app victim?’, “Since when have you been using loan apps”, “How many loan apps are you indebted to? Please list them, and “where is your location in Nigeria?”.
The ICIR gathered that these groups sprang up in reaction to the method loan apps, which are largely unregulated, used to retrieve their funds. “Loan Apps Victims Initiatives”, “Mobile Loan Apps Debt Victims in Nigeria”, and “Say No To Illegal Loan Apps” are a few of such groups.
Earlier investigations by The ICIR show how illegal loan apps ignore Nigeria’s cyber laws and shame customers over late repayment of loans, threatening and using inappropriate words for customers amid excessive use of debt recovery tactics by their debt recovery agents.
Many loan apps operating in the country disregard consumer protection regulations while regulatory agencies turn a blind eye. 
A debt collector identified as Tobilola who works for one of such apps with first-hand knowledge of their operations told The ICIR in an earlier report that the recovery agents are split into five teams with a team leader assigned to each.
The teams are headed by a team leader who assigns customers to the debt collectors based on the duration of time they have defaulted on their loans.
“We are divided into five groups. Most debt collectors prefer the first to the third team because their focus is on short-term overdue loans, which are easier to retrieve than long-term loans.
“We are assigned 400 customers per week to each debt collector at the call centre, and they don’t care whatever you do to recover overdue loans from customers,” he said.
The debt collectors sometimes send messages to a debtor’s contact list or social media saying the debtor is a fraudster. Some of the messages contain personal details and even the Bank Verification Number of the person.
Image redemption and rebranding
Debtors and or users of loan apps who have had defamatory or debt collection messages circulated about them go to some of these groups to get rebranded.
Mobile Loan Apps Debt Victims provides such rebranding service via their Telegram channel. They provide bulk SMS with customised messages which are sent out to the debtor’s contacts telling them that the person is not a fraudster. This message cost N50 per contact.
One of the messages seen by The ICIR reads: “victim didn’t collect any loan online”, “She is a victim of fraudulent online mobile loan apps who are using her leaked financial information with them to extort money”.
The sentiments expressed in most of the groups The ICIR monitored is that if more people take loans and do not repay the illegal loan apps would run at a loss and fold up.
In some of the groups, members are encouraged to report the apps in the Google Play Store so that they would be taken down. In another, attempts were made to trend the hashtag #BanOnlineLoanApps.
Are the groups helping or just another money-making scheme?
A trend The ICIR observed is that some of these groups which claim to be set up to help loan victims are also out to make money. Aside from charging N50 per contact for ‘redemption’ SMS in one group, another group ‘Loan Apps Victims Initiatives” charges N1500 for victims to obtain a clearance letter purported to be from the Federal Competition and Consumer Protection Commission (FCCPC).
The memo which contains the logos of the FCCPC among others reads: “Nigerian financial institute has cleared the name of a victim, as they are debt-free and trustworthy, urging the public to disregard any defamatory message that may have been received from an illegal loan app”.
The ICIR reached out to the FCCPC and discovered that the memo did not originate from them.
This was also confirmed by a member of the group who identified herself simply as Yetunde: “I know what people are doing by forging documents is wrong. But what do you expect them to do? I won’t blame them if that’s a way to regain their sanity”.
“I’m a Christian and I know every loan is supposed to be repaid, but I’ll do that at my convenience now, not minding the shame and reproach I already got from the defamation”, she added.
A Nigerian lawyer, Festus Ogun, said, “There are debt recovery processes recognised by law. This includes but is not limited to instituting an action in a civil court for recovery. Criminalising debt recovery is entirely out of place in our commercial jurisprudence.
“Sending unsolicited messages to contacts of their customers who are yet to repay loans is a gross violation of the rights to privacy under Section 37 of the 1999 Constitution. Equally, victims of loan apps defamation can approach a civil court for redress.
“Privacy of citizens is so important to the point that the National Data Protection Regulations clearly frown against its violations, especially in the ill manner online loan apps go about their recoveries. There is a better way to achieve results than breaching other citizens’ privacy and making libellous publications against customers.
“Forgery and misrepresentation are criminal offences. Those behind the faceless apps should be arrested and thoroughly prosecuted. Sadly, the authorities seem not to be doing enough in this respect. All thanks to the FCCPC for its recent interventions,” Ogun submitted.
In April 2022, the FCCPC in collaboration with the National Information Technology Development Agency (NITDA) and the Independent Corrupt Practices and Other Related Offences Commission (ICPC), commenced criminal proceedings against illegal loan apps, popularly referred to as “loan sharks.”
Earlier in March 2022, the commission conducted a raid on multiple loan app firms in Lagos.
A reporter with the ICIR
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Please I need help.have borrowed money from ncash 3000in last year December and I return it on December 23but have done mistake sent 18000 instead of 3000…since then they no return my money and they no borrowed me another one… they no answer my calls
I actually borrowed loan online cause of my heart issues..I wasn’t feeling that well and I needed a money for my treatment,I was in a haste to get the money that I forget to read the terms and conditions of it so I was giving 7days to pay back the loan which I wasn’t able to pay back now am not able to walk freely because of the threaten
Loan sharks are out to push unfortunate Nigerians to Depression and worse Sucide due to their method of debt recovery and the FG is keeping a blind eye to them .
Comment:why is the cbn. romancing illegal loan apps operators and their debt recovery agents , they are sabotaging the nigerian economy and must be flushed out at once pls .