Access to credit has remained a major problem, but the increase in technology-driven lending applications are opening up opportunities for finance, Tofunmi Sanusi reports
The impact of COVID-19 on the economy, including consumer loans, cannot be overstated. Various measures taken by the government to curb the spread and transmission of the deadly virus, including lockdowns, have resulted in the economy contracting, unemployment rising and disposable income dwindling.
Economic uncertainty has also affected the financial services sector. Credit institutions were initially cautious before committing to new credit facilities. A number of banks have reportedly missed the Central Bank of Nigeria (CBN) loan-to-deposit ratio of 65%.
Increasing access to credit facilities for businesses and individuals could therefore be a necessary stimulus to increase economic activities in Nigeria. Analysts said this would strengthen efforts to recover the economy in the short to medium term.
To underscore this, Central Bank of Nigeria (CBN) Governor Godwin Emefiele said banks increased their total lending to the economy by 3.3 trillion naira in June of last year. According to the monetary policy document released by the regulator, the banks’ total gross credit rose from N15.56 trillion in May to N18.9 trillion at the end of June last year.
In line with the new realities brought on by the pandemic, strategies that promote contactless activities have continued to evolve within the financial services industry.
Banks, in particular, are among those that take advantage of advanced technologies and innovations to increase access to credit; and foster financial inclusion by pushing the boundaries of digital banking platforms and channels.
Euromonitor International Nigeria Consumer Loans report establishes that the size and structure of the ATM cards, chip cards, credit cards, debit cards, charge cards, cash machines, Prepaid cards and store cards continued to grow in leaps and bounds.
Quick and easy loan application or credit processing is an exciting way of life in Nigeria. A quick scan of the credit market brings up the top five fast loan apps that are easily accessible and visible, according to Abimbola Yewande, a Lagos-based credit analyst who listed VULT of Polaris Bank, Carbon, PalmCredit, Branch and Renmoney, among the top quick loan applications.
Polaris Bank recently launched its 100% self-service digital solution, VULTe, to boost accessibility to quality banking services, as well as reduce barriers to accessing credit up to N5 million, at for both clients and non-clients of the Bank.
VULTe is a fully digital bank that offers individuals fast, convenient and reliable solutions to their banking needs. Some of its unique features include QR payments, end-to-end account opening and debit card application, issuance and activation, without customers leaving the comfort of their home, office. or where they are.
The platform isn’t just for Polaris Bank customers; non-bank customers can also download and enjoy banking services on VULTe.
Another key feature is VULTe’s Banking API, which allows merchants / businesses to integrate VULTe with other business critical systems, enabling a portfolio of services including risk assessment, requests for bank statements, lien accounts and direct debits.
Much more than an app, Polaris Bank Chief Digital Officer Dele Adeyinka explained that VULTe’s instant lending feature is a very unique innovation with which the bank is deepening the lending market in Nigeria, among many others. functions and benefits difficult to obtain elsewhere.
“VULT allows a customer and a non-customer of Polaris Bank to same day you apply for and get instant loans within two minutes right in the palm of their hands, using your smartphone,” Adeyinka said.
In order to use VULT, a prospect / customer must be 18 years of age or older. The platform is also open to SMEs and businesses, and can be found and downloaded from Google Play and Apple store.
Carbon requires applicants to provide their BVN to check their credit, before the loan application can be approved. Individuals can access up to N1 million.
While the process is transparent, with no paperwork, guarantor or collateral required, Carbon does offer individuals cash back on the interest paid when loans are repaid on time.
The platform also allows individuals to pay their bills, invest and receive credit reports from financial institutions.
Individuals in Nigeria can obtain loans from PalmCredit without providing collateral. PalmCredit offers low interest rates on its loans, making it an attractive and popular money lending platform in Nigeria.
It is only available to people 18 and over, and loan seekers can borrow as little as N 2,000 and N 100,000.
To qualify and receive a loan, customers must follow three simple steps to register a PalmCredit account, get approval, and then receive payment into their account. Every time you pay off a loan, your loan limit increases up to N 100,000.
Branch is one of the best loan apps in Nigeria and unlike its competition it also works in other countries like Kenya, Mexico and India.
Its main USP is that as customers acquire credit with Branch, their loan limit also increases. All you need to do is apply through the app and get your loan approved within 24 hours. The branch does not charge any fees.
Customers are free to use the credit they get from the platform for whatever they prefer, as no official will ask them the purpose for which the loan is requested.
Renmoney is a very popular lending platform that financially supports micro, small and medium businesses.
To be eligible for a loan, a client must be between 22 and 59 years of age, have a verifiable source of income, and live or work in cities where Renmoney operates.
Individuals can borrow up to 6 million naira for a maximum period of 24 months. To be approved for a loan, a customer’s bank statement must prove that the loan could be repaid within the repayment period.
According to Euromonitor, a positive outlook for the Nigerian economy in terms of resuming the recession induced by COVID-19, has been predicted from this year. And that can pave the way for an increase in demand for consumer loans. The willingness of lenders to increase access to credit opportunities for individuals and businesses will therefore be of the utmost importance.