In Nigeria, thousands of people have turned to personal‑finance apps for quick, short‑term loans as a way to cope with the country’s economic crisis. These apps often lure borrowers with promises of low interest rates and easy access to cash, but many have turned out to be “predatory,” charging exorbitant rates and resorting to harassment when borrowers cannot repay on time.
Mariam Ogundairo’s experience illustrates the problem. She borrowed 30,000 naira (about $20) from a loan app, only to be hit with a 21.6 % interest rate and relentless threats after missing a payment. Some apps even send threatening messages and leak sensitive photos to the borrower’s contacts, intensifying the pressure on indebted users.
The issue has generated a wave of complaints. Citizens’ Gavel, a civil‑society organization, has recorded more than 1,300 reports of predatory digital loan apps. The crisis is compounded by Nigeria’s broader economic woes, including inflation that reached 21.8 % in July and reforms by President Bola Tinubu that, while intended to stimulate growth, have raised the cost of living and pushed many into debt. The Central Bank of Nigeria noted that outstanding personal loans rose 21.27 % to 3.82 trillion naira in the last quarter of 2024.
Regulators have begun to act. The Federal Competition and Consumer Protection Commission (FCCPC) has approved 408 loan apps while delisting 47 for offenses such as harassment. Nevertheless, many apps continue operating under new names, and borrowers often fail to verify whether an app is on the approved list before applying. This has created a thriving market for loan sharks who exploit desperate borrowers amid weak sanctions and poor enforcement.
Support groups have emerged on social media, where victims share their stories and seek assistance. Funmi Oderinde, a lawyer with Citizens’ Gavel, warns that the promises made by these apps are frequently deceptive, leading borrowers to face unethical recovery tactics, including defamation, harassment, and breaches of data privacy. The FCCPC has pledged to monitor interest rates to prevent exploitation, but further action is needed to safeguard borrowers from predatory practices.
As the crisis deepens, the response of regulators to the growing outcry from borrowers and civil‑society groups remains to be seen.
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