It will take me less than a minute to spot a mobile online lender and will even allow the application that I must first install on my Smartphone have access to a number of items among them my messages and phonebook before accessing the funds.
Rarely do we consider the kind of trouble we might be exposing ourselves, families and friends to including one accessing all the information that is on your phone which according to me should be confidential.
A friend of mine last month spotted a new app online and in haste installed it on his mobile phone and luckily got a loan of Sh2000 that was to be repaid by end of April at some interest rate.
Unfortunately, he had not paid a single cent by April 30 when he was required to have fully repaid the loan. Chains of messages began flooding his phone demanding that he pays the loan failure to which automatic penalty of Sh50 per day will continue accumulating.
Little did I know that I could be among the list of many to later receive messages asking that we help the lender recover the money from the loanee in what was a clear indication that they had access to my friend’s contacts.
What kind of humiliation could this be? I thought. My friend later confirmed to me that they had texted his entire contact list including his wife, parents and business associates attracting a lot of unnecessary calls on his phone.
“It was so humiliating and I recall one of my relatives asking me if I had been loaned or were just conmen,” he said vowing to never again apply for the mobile loans.
On why he would not apply for loans at the nearby banks, he just said “banks have a lot of procedures and need a lot of details including guarantors who mostly are hard to find,”
A sample of the message I received read ‘Kindly inform KM to clear his loan of 5000 today by 4pm before we proceed to take legal action and to avoid being blacklisted as a defaulter. We have tried to call for the past 5 days in vain. You were included as his referee on the loan’.
In Tharaka Nithi, mothers who have fallen prey of fast mobile loan have warned residents against 4G Capital Limited that they claimed had duped hundreds of small scale traders in Chuka town.
The Press Point established that tens had already closed their businesses for fear of being roughed up by the officials who visit their premises to demand the monies.
The gullible mothers said opening of the lender’s office in the town come as reprieve to them and saw it as an easy opportunity to expand their businesses by accessing loans but did not know the repercussions that would accompany the goodies.
A disgruntled mother of four told us that before she was given a loan of 15, 000, the mobile loan officers first visited her kiosk and assessed, took photos and asked for contact for one of her kin.
“I got the money in less than 15 minutes and saw it as the convenient way to help me expand my business,” she recently told the Press Point at the town.
Unfortunately, she did not manage to pay back the total amount with accrued interest of Sh4500 translating to 24% rate and had only paid Sh9000 by end month.
Two days later, she received a notification that she had to pay 12500 instead of the 10500.
Should one fail to pay within the agreed time (in most cases a month) the Fourth General Capital Limited officers’ storm businesses and even seize their commodities, she claimed adding that they are also very vulgar.
“They once found me at my shop with a customer and embarrassed me so much. The officers even took some commodities and forced me to close,” another said.
The woman had to sell her Sh20, 000 smartphone at throw away price of Sh14000 to pay the debt and avoid further embarrassment.
The branch manager of 4G Capital Simon Njoroge recently told journalists that their loan attracts an interest of 14% contrary to the confirmed one of 24%.
He further said in default, the loan attracts 1% interest each day meaning one with an overdue loan of 10, 000 will have to pay the principal amount, 14% interest on the loan and 14% interest as penalty if he honours it two weeks later.
The officer however refused to share with media a blank copy of the form that he purported clients must fill before accessing the monies.
The officer said each client must also pay a membership fee of Sh500.
“All those who pick loans sign an asset list of items that can be repossessed should they fail to pay the money within the required and agreed time,” Mr Njoroge said.
“If they don’t pay, we will go for them. I will not smile at someone who has failed to pay a loan, we are in business,” he stressed.
Isn’t that enough to make you refrain from such loans and avoid such disappointments?
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