Government Agency to Go After 9credit, Palmcredit as Soko Loan Tries to Avoid N10million Fine
- Soko Loan has been fined N10 million by the National Information Technology Development Agency for breaching privacy of Nigerians
- The government agency also plans to work with the police to institute a lawsuit against the executives of Soko Loan, with a possible jail term
- NITDA is also going after Palmcredit, 9credit for their role in privacy invasion as Nigerian lending apps adopt culture of blackmailing their debtors
The National Information Technology Development Agency (NITDA) is clamping down on loan apps in Nigeria, as the agency moves from Sokoloan to 9credit, Palmcredit, others.
In a statement released by NITDA, Soko Loan was accused of breaching the regulation of the agency by breaching the privacy of its users and the general public.
Soko Loan had been accessing the phone contacts of its borrowers, informing the contacts through messages that the debtor is a criminal and fraudster.
Source: UGC
In July, Legit.ng had reported this privacy breach and how Soko Loan had been blackmailing users despite having repayment system issue which customers complained off.
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In one of the messages seen, Soko Loan accuse a debtor of duping the company, stating that the person is on the run, and his contacts should stay away from him.
Soko Loan fined N10 million, executives risk jail term
A month after Legit.ng report, NITDA has taken action against Soko Loan with a N10 million fine, and directed the lending app to pay for a Data Protection Impact Assessment by a NITDA appointed DPCO on its operation.
The agency also stated that a criminal proceedings will be launched against the executives of Soko Loan, and the Police have been contacted for advise on criminal charges.
NITDA confirmed to Legit.ng during a phone conversation with our reporter on Thursday, that Soko Loan will be charged to court despite the fine.
Soko Loan moves to resolve N10 million fine, jail term threat with NITDA
Following the announcement of the fine, it was gathered that Soko Loan contacted NITDA to resolve the situation, however, the loan company was told that their effort was too late.
Legit.ng tried to enquiry about the N10 million fine from Soko Loan, but the company didn't respond to the emails, and phone contacts made available was not reachable.
NITDA said the privacy invasion case has already been sent to the Police as the number of complaints against Soko Loan was in hundreds.
9credit, Palmcredit, others under investigation
Legit.ng gathered that 9credit, Palmcredit, which was also cited in this publication's previous report, are also under investigation, following complaints from their users.
NITDA said after the agency made it public that Soko Loan has been fined N10 million, it received series of complaints about other lending apps privacy breach.
The timeframe of the probe into the activities of 9credit, Palmcredit and others wasn't made known, but Legit.ng confirmed that NITDA will release its findings just as it did with Soko Loan.
How Soko Loan, Palmcredit are pushing Nigerians into more debt
Loan apps and borrowers are not in good terms over repayment issues, which have seen debtors incur more debt despite having funds to pay
Users of Nigerian loan apps are struggling to make payment before due date as the lending companies don't have functioning payment system.
This increases the fine for late payment and thro borrowers into more debts. Legit.ng gathered that in some cases, users get debited, but it still reflects that they are owing.
Source: Legit.ng
