Know Your Rights: (15) We have prepared a comprehensive list of policies that protect you as a borrower. Know your rights and be free from the shackles of loan apps.

Penal Rate3 for late repayment of loans, authorized overdrafts, micro leases, microfinance-related hire purchase and other advances/facilities, including unauthorized overdraft

Maximum of 1% flat per month on unpaid amount in addition to charging current rate of interest on outstanding debt (without prejudice to the provisions of the Prudential Guidelines on the limitation of accruals)

5.5.7 Not engage in any of the following:

a. Contact friends, employer, relatives or neighbours of a customer for any information other than information on employment status, telephone numbers or address, except where:

1. The person has guaranteed the loan; or
2. The person has consented to be contacted. 

b. Require any of the persons listed in (a) above to offset the debt, except where the person has acted as a guarantor. 

c. Make telephone or personal contact with customers between the hours of 9.00pm and 8.00am for the purpose of debt recovery, except with the prior consent of the customer. 

If a loan app falsely accuses you of being a thief, publishes your name or contact info, or sends messages to your friends or family saying you defaulted — you have rights under Nigerian law.

According to

Section 373 of the Criminal Code Act,

defamation means “matter likely to injure the reputation of any person by exposing him to hatred, contempt or ridicule, or likely to damage any person in his profession or trade by injury to his reputation.”

What this means is: when a digital lender publishes false and damaging information about you, you can take legal action — and you may be entitled to compensation (such as the headline “up to ₦7 million”) if you can show the harm done to your reputation.

• If a loan has been overdue for more than 90 days (3 months) — that means the borrower hasn’t paid interest or principal for that long — the loan becomes non-performing.
• Once a loan is non-performing, the bank must stop counting interest as income on paper.
• The bank can only recognize interest when it actually receives cash (cash basis), not when it’s just “accrued” or expected.

• 4.2.1 The content of advertisements shall be factual and unambiguous, expressed in clear and simple language and shall not be offensive, misleading, deceptive, injurious, or exaggerate the benefits of the products or services being advertised. 

5.2.9 Issue Letter of Discharge at no cost to customers within 5 business days after liquidation of their loans, and where the loan is guaranteed, the guarantor shall also be notified accordingly.  

Section 17(a), (g), (m), (s) & (t) — The Commission shall protect consumers from unfair trade practices, ensure fairness, honesty, and equitable dealings, and prohibit misleading, unfair, or deceptive conduct.

Loan Apps must be honest about their terms and interest. If they lie or use threats, you can report them, and you are not liable to pay such a loan

When the cost charged is grossly disproportionate to the service rendered.

Example: ₦5,000 “late fee” on a ₦10,000 loan.

📜 CBN Rule: Charges must be fair, transparent, and cost-reflective, not exploitative or punitive.

• Any unfair terms used in contracts are void and shall not be binding on consumers.
• Contract terms that conflict with any laws or regulations are null and void.

5.4.3 Not transfer personal data of consumers to a third party without their express consent, except in compliance with a legal obligation.

5.4.4 Inform consumers whenever their data is exchanged with an authorized third party, stating details of the exchange.

Management Fee covering processing, appraisal, ancillary and other related fees on a new loan application (one-off charge)

Negotiable, subject to maximum of 1% of the principal amount disbursed (one off charge)