How Borrowers’ Phone Contacts Became Their Ultimate Collateral!

The common slogan “loan apps without collateral” often paraded to deceive unsuspecting borrowers that the online lending platforms do not require any collateral security or document to process a loan for individual and business borrowers is a ruse and bait to entangle you into their evil net and “den of captivity”.

Collateral is money or property which is used as a guarantee that someone will repay a loan. Many people use personal assets as collateral for small business loans. However most people in Nigeria cannot borrow from traditioanl banks because they lack collateral to stand in. As a result the evolution of digital banking and online lending platforms without demanding collateral simplified this process and aparently made borrowing very easy.

However unknown to many Nigerians, the “collateral” which lending platforms get in exchange for peasant credit and soft loans to their customers is a far cry more destructive, debilitating and extremely unreasonable and we dare say illegal in every aspect of it.

The pain and reward for late repayment and default of borrowings from loan apps have led some to commit suicide, go insane and some others lost their humanity. We must stop the loan sharks in Nigeria, in Africa and anywhere on the planet from these unethical and illegal loan recovery practices.

In this article, we explain how your loved ones’ phone contacts, your family members and friends’ contact information and pictures and banking details are being used to ultimately secure, and in event of default recover any soft loan you obtain from these loan sharks masquerading as online banks. And what you can do to stop them!

The post pandemic era witnessed the advent of many digital lending platforms and loan apps in Nigeria and many countries across the globe. One of the greatest hyped feature of these loan apps and online lending platforms is that they operate and give out credit to customers without needing collateral, documents or physical presence as often demanded by traditional banks.

Due to this novel functionality, many Nigerians turned these digital banking platforms that promise quick and instant cash to their darling avenue whenever they face cash emergencies. The mere knowledge that you can easily approach a relatively known or completely unknown online platform and get cash within few hours if not minutes made loan patronage a seamless affairs. With this many Nigerians jettisoned the traditional banks with all its bureaucracies, collateral and documentation.

The ability of securing instant credit within minutes just after a few clicks on a loan app or a digital lending platform, and particularly without collateral or any form of documentation made these  lending apps and online banks a darling of many people. It’s a not just a great excitement but a revolutionary innovation to know that you can access instant cash of say N50,000 or N100,000 at the corner of your room within a few clicks on your mobile phone without visiting any bank and without any physical correspondence.

How Customers Phone Contacts Became The Ultimate Collateral In Event Of Loan Default

What borrowers and indeed many Nigerians did not know, however, was that the hundreds or thousands of contacts (as the case may be) discreetly stored on their mobile phones or smart phones whether Android or Apple was the ultimate collateral in case of default for the various loans they have accessed.

The numbers stored on their phones and accessed by the loan apps in Nigeria, were the lenders’ insurance, guarantees and indeed collateral against any inability to repay or repayment defaults of any kind. In essence, borrowers’ reputation and dignity or whatever was to be left of it was to be used in guaranteeing and securing repayment of instant loans in event of default.

See below how a customer by name Isaac Ojo Obisesan was grossly humiliated by a loan app in Nigeria for defaulting his repayment as at when due. What collateral could have been more than this for any digital lending platform? Isn’t this enough to force repayment by a defaulter if only to avoid the gross shame, ridicule and defamation associated by a phony loan app all out to secure its loan disbursement?

Frequently Asked Questions (FAQs)

We have attempted to answer a few common questions on how you can stop loan apps from accessing your phone contacts. Why the answers are not direct, they are situational and based on what previous actions you have taken.

1. Can You Stop Loan Apps In Nigeria From Accessing Your Phone Contacts?

The simple answer to this question is a NO! Provided you have once downloaded the loan app and have collected a loan from the platform. You can no longer stop the loan app from accessing your phone contact because it is already safely stored in the app’s external database. Even though you later uninstall the app, it is still with them. The best you can do is stop collecting their loan and repay any outsanding loan to avoid any further harrassment, threat or blackmail.

2. How do I get loan apps In Nigeria to stop calling my contacts? How do you stop loan apps from accessing your phone contacts?

To stop loan apps from accessing your phone contacts or calling your contacts and family members, do the following:

1. Don’t download any loan app on your phone.
2. If you have already downloaded a loan app, don’t approve or collect any loan from the platform.
3. If you have already collected a loan from the platform, delete and uninstall the app immedialy from your phone and do not reinstall or collect any further loan from the credit platform.
4. Only download and patronize reputable loan apps that will not send shame or defamatory messages to your contacts, even if they have your phone contact access.

3. Can a loan app access my contacts if uninstalled?

A loan app cannot access your contact list if you already uninstalled the app from your phone. However it’s likely your contacts have been downloaded and stored in the app’s database outside your phone if you ever collected a loan from them. To stop loan apps from accessing your phone contacts again, safely uninstall the app and do not patronize them anymore.

4. Can loan apps come to my house?

A loan app cannot come to your house. However if you already downloaded their app and collected their loan, they can access your contact list, databases, BVN, profile details and can report you to the credit bureau and blacklist your name against your BVN if you default on your loan. To stop loan apps from accessing your phone contacts again, safely uninstall the app and do not patronize them anymore.

5. How do I stop messages from loan apps?

To stop messages from digital lenders or stop loan apps from accessing your phone contacts again, safely uninstall the app and do not patronize them anymore. Also if you are owing any outstanding loan, pay down and let the app be aware that you have paid your loan to update your records.

6. How to stop a loan app from accessing your contact?

1. Don’t download any loan app on your phone.
2. If you have already downloaded a loan app, don’t approve or collect any loan from the platform.
3. If you have already collected a loan from the platform, pay back any outsanding balance, delete and uninstall the app immedialy from your phone and do not reinstall or collect any further loan from the credit platform.
4. Only download and patronize reputable loan apps that will not send shame or defamatory messages to your contacts, even if they have your phone contact access.

7. Can Denying Loan Apps Permission Stop Them From Calling or Messaging Your Contacts?

YES. Once you deny a loan app permission to access your contact list, you automatically stop them from accessing, calling or messaging your contacts. However if you deny any lending platform permission from accessing your contact, your loan will NOT be approved and you won’t get any funding from the loan app. So you have to decide on which one is more important to you.

8. How Do I Prevent Fake Loan Apps Like Sokoloan, LCredit and others From Calling Or Messaging My Contacts?

To stop loan apps from accessing your phone contacts generally or specifically stop scam platforms like Sokoloan or LCredit from messaging your list, do not download their apps on your phone. Do not approve or collect any loan from them. Do not give them permission on your phone to access your contacts. That essentially means you cannot have access to collect their loans.