Money is essential for facilitating virtually everything, including financing business growth and development. To meet the need and demand for money, lending has evolved with financial institutions, especially banks, offering large scale credit facilities mainly for investment and related matters. This then expanded to include low-income people who wanted to purchase essentials such as cars, refrigerators, televisions, generators, etc., and meet other personal needs. Eventually, money lending evolved beyond line of credit loans to acquire consumer goods from manufacturers, owners, distributors, or retailers for which payment was made in installments or deferred to a later date.
The outbreak of the COVID-19 pandemic has put many Nigerians under severe economic pressure, thus forcing many of them to obtain personal loans from digital platforms offering collateral-free loans. Because of this, individuals bowed to other means of survival, and some, unfortunately, got stuck in the web of predatory money lending apps. These fraudulent and predatory digital loan apps disguise themselves as platforms where you can access quick loans without collateral. However, they require a plethora of data such as the applicant’s Bank Verification Number (BVN), name, permission to take photos and video recordings, location access, contacts, media and files on devices.
This article will discuss money lending and loan sharking and the regulation of money lending in Nigeria, especially as it relates to digital lenders. The article will also assess the position of data privacy law, provide an analysis of data privacy concerns vis-à-vis the threat of predatory lending, and provide recommendations on how to strike a balance. in the money lending space.
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The content of this article is intended to provide a general guide on the subject. Specialist advice should be sought regarding your particular situation.
