Can Online loan arrest you in Nigeria for owing

Do you think an online loan can arrest you in Nigeria for owing them? I will tell you that within our discussion. 1st of all know this today, hardship and inflation caused these all and have left many businesses incapacitated leading to businessmen and women seeking any alternative means that would be used to lift up their businesses. But the use of loans can equally be attributed to factors like:

• Increased smartphone penetration: Access to smartphones is more common for Nigerians to have, making it easier to download and use loan apps.
• Financial inclusion: For a quicker and more convenient alternative to traditional lenders loan apps have you covered, which can be bureaucratic and require collateral.
• Growing demand for short-term loans: small business ventures use these apps to cater to people needing quick cash for Emergencies.

However, despite their convenience, borrowers using online loan apps sometimes express concern about the possibility of arrest if they fail to repay their loans that’s not all most times these loan apps access your contacts sometimes they access your bank account without your permission these are but few of the loan app harassment you might face aside of jail time if they go against the law.

Is Loan Default in Nigeria a Civil Matter or Criminal?

Defaulting on a loan is a civil matter, not a criminal one. So can you be arrested? no dear you cannot be arrested or jailed simply for not repaying a loan. However, you can be charged legally to court for breach of contract.

Here’s the difference according to the Nigerian Constitution

Chapter 7: The Judiciary:

(specifically sections 60 and 61) of this chapter establishes the Nigerian judiciary as an independent arm of government. Handling of civil matters is the major work of the judiciary, which includes disputes like loan defaults.

Separation of Powers:

Separation of powers is ensured by the constitution between the judiciary, legislature, and executive branch. This principle implies that the judiciary handles civil disputes, while criminal offenses are dealt with by law enforcement and the criminal justice system.

HEADS UP: Do you now see that the Loan defaults, being financial disputes, fall under the purview of the judiciary, suggesting a civil matter.

What happens if an online loan is not paid?

My brother and my sister you are in a big pot of soup. Although according to the law, you cannot be arrested for not meeting up on payment you owe in this case the loan lender can easily take it up legally and sue you in court for breach of contract. I bet you can hardly win such a case in court. let me give you a real-life example.

Ceo innoson group of companies once took a loan from Gt bank though he repaid them all but the bank continued collecting more from him even after he repayed all his interest. Till he discovered it and charged the bank to court for breach of contract. He won and was payed all his extra payments back with more interest. this example is a reversed case study but i hope you got the picture?

Can Online loan arrest you in Nigeria

am still trying to give you a more clear and easy example. using my friend’s case it was a very nasty moment for him i think this happened in the year 2023 though cant remember the actual month and date but it was hell on earth for chinedu.

Truthfully he was not arrested we never saw any police, efcc, any law enforcement agency on his compound buh they already left a scar on his heart his image was tarnished he was flagged as a killer (defamation text) this was sent to all his contacts. so i think this settles it and takes away the fear of being arrested. so by law like we said earlier you can not be arrested for owing a loan.

Negative consequences of owing a loan app

• Negative credit score: Your credit score will be damaged if you default, making it harder and more expensive to borrow money in the future.
• Harassment from lenders: Aggressive tactics to collect the debt might be an option for some loan apps, including contacting you constantly or threatening legal action.
• Court judgment: The lender may win a judgment against you in court, allowing them to seize your assets to recoup the debt.

Can you go to jail for not paying online loan?

Earlier on I told you that owing any type of loan is a civil matter so you cannot be arrested. But now concerning going to jail, I am telling you it’s not certain what would be the outcome.

Everything about being jailed depends on the outcome of the judge’s rulings you might be given some days or months to complete your payment or if you default again he might take another measure which might include confiscation of property to pay up.

Conclusion

Bringing this to the finale, always have this in mind, defaulting on a loan in Nigeria is a civil matter, not a criminal one. You cannot be arrested or jailed for not repaying a loan but can be charged to court after your repayment time elapses.

While there’s no arrest, defaulting can still have serious consequences. To avoid these issues, borrow responsibly:

• Only borrow what you can afford to repay.
• Understand the loan terms and interest rates before you agree.
• Explore alternative lenders if the terms seem predatory.