The brutal reality of borrowing from loan sharks has negatively impacted on individuals who see such platforms as their go-to places for financial help. Loan sharks are systems designed to break the borrower. This article provides insight on the human cost for these traps.
Across Nigeria, thousands have fallen victim to illegal lending apps and unlicensed digital moneylenders. Despite government crackdowns, many still operate under new names or fake corporate fronts – preying on the financially desperate.
Take the story of Amaka, a Lagos trader who borrowed N50,000 for her food stall. Within six weeks, she owed N120,000 after late fees and daily interest deductions. When she couldn’t pay, loan agents began texting her contacts, calling her a fraudster. Her mental health broke before her business did.
Imagine this: someone borrows N100,000 or N200,000 – maybe to pay hospital bills, maybe to keep their small business afloat, maybe just to feed their children. The terms seem simple at first. But miss a payment, delay by a week, and the interest begins to grow like wildfire.
Before they know it, that N200,000 has ballooned to N500,000. No renegotiation. No mercy. Further, threats and harassment follows, and the debt gets to feel like a death sentence. This cannot be called bad math but engineered cruelty.
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Even when the borrower manages to pay on time, the interest rates are usually outrageous. A loan of N100,000 might come with a repayment demand of N140,000 within a short time. Imagine N40,000 profit expected from someone already in crisis.
Let’s be honest: in today’s economy, where profit margins are razor-thin and survival is the goal, how realistic is it to expect someone to generate N40,000 in profit just to pay back a loan? It’s not just unrealistic – it’s wicked.
Loan sharks don’t care about your business. They don’t care about your family. They care about control. They care about fear.
Why Repayment Becomes Impossible
Loan sharks thrive on desperation. Their goal isn’t repayment – it’s dependence. Interest compounds daily, penalties multiply, and intimidation ensures silence. The system is built so you never escape.
The Psychological Trap
It’s not just financial. It’s emotional. Borrowers live in constant anxiety — afraid to pick up their phones, afraid to step outside, afraid of what tomorrow might bring. The shame, the fear, the isolation – it eats away at their dignity.
And the worst part? Many feel they have no choice. Traditional banks reject them. Friends and family are tapped out. So they turn to the only door that’s still open — the one that leads to a trap.
These aren’t just numbers. These are mothers, fathers, students, traders, artisans. People who work hard. People who dream. People who deserve better.
We must stop normalizing this exploitation. We must start calling it what it is: financial violence.
3 Things that Needs to Change
- Governments must crack down on predatory lending practices.
2. Communities need financial literacy programs that teach alternatives.
3. Microfinance institutions and ethical lenders must be empowered to serve the underserved.
But most importantly, we need empathy. We need to stop blaming the borrower and start questioning the system.
Loan sharks thrive on silence. The more people share their stories, the harder it becomes for these exploiters to hide behind apps and anonymity.
Debt shouldn’t destroy dignity – it should empower growth. Until we fix the system, empathy and awareness remain our strongest weapons.
Frequently Asked Questions (FAQ)
Q: What are loan sharks?
A: Loan sharks are illegal or unlicensed lenders who charge extremely high interest rates and use threats or harassment to recover debts.
Q: How can I report a loan shark in Nigeria?
A: You can report to the FCCPC, the CBN, or EFCC with evidence such as messages, app details, or payment records.
Q: Are all online loan apps loan sharks?
A: Not all. Many registered microfinance platforms operate legally, but users must verify registration before borrowing.
