Why Quick loan customers are prone to default – Bank Boss
The Chief Executive Officer (CEO) of Baobab Micro Finance Bank, Kazeem Olanrewaju says quick loan customers are prone to default than the normal loans.
Olanrewaju says, “In most cases you have some parameters that are set in the system to determine customers that are qualified for thes quick loan, so if a customer is able to understand these parameters and they decide to work through them, they could get the loans when in actual fact they are not qualified.
“So, what you can see is a situation where the people you intended to give this loan may not get it, and those you intend not to get the loan may be the ones that will access it.”
He also raised issues on suspected fraudulent activities by some who take the loans, taking advantage of the digital platforms.
He said, “If the quick loan is not on any of the Credit Bureau Platform, it means it is not reported, and so if it is not reported the general public or the industries are not aware that the loan has been granted. Such a customer can access a loan from multiple sources, which, when you compare to their source of income or their salary, the loan may be beyond the threshold expected and so it means that they are over-indebted.”
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