In the early hours of Sunday, March 26, Quadri Tella woke up to an emergency phone call that left him confused. The caller informed him that his girlfriend of three years had been rushed to the hospital and they needed to make an advance payment for care to be administered.
“They took her to the hospital at about 2 am. She had been sick with a high fever, and the nurse available said it was food poisoning. They were asking for N25,000,” Tella recalled highlights of the telephone conversation.
With only N15,000 in his account, the 32-year-old Lagos-based factory worker said he was left with no other options than to patronise an online lending company for the remaining N10,000.
The last loan shark he borrowed from had sent abusive and threatening messages to him and his contacts for failing to pay back. This time, he decided to try a new one.
He went for NINECASH, which operates on browsers and not on Google Playstore or App Store. Such apps can be downloaded from Android Package Kit (APK), and because they have fewer Know Your Customer (KYC) requirements, they are popular among young Nigerians in need of quick cash.
After paying off his friend’s hospital bills and repaying the loan, Tella borrowed again. He took the third time and accumulated debts. When he defaulted, the firm sent multiple texts to his contacts.
“NINECASH lent me 26k to pay back 40k in seven (7) days. On my due date at precisely 10 am, they started sending threats to my contacts and family members,” he said.
Mr. Tella’s story is part of a wider problem in Nigeria, where many people have become trapped in a debt cycle by borrowing from secret loan apps that operate on web browsers to avoid increased regulations. These apps often have high interest rates and fees, and borrowers can quickly find themselves in over their heads.
A Pluboard review has found that after the Nigerian government and app store owners like Google stepped up regulation, by deleting predatory loan apps and setting tougher requirements for listing, mostly Chinese-linked loan sharks shifted their focus to web browsers to reach Nigerian targets. We found NINECASH to be owned by a Chinese company.
Rights advocates and lawyers say the apps operators violate Nigerian laws, especially the Nigeria Data Protection Act 2023 which protects personal information.
“We have said it again and again that the loan companies do not have any lawful basis to process the personal data of individuals, this is notwithstanding any privacy policy contained in their website,” said Festus Ogun, a human rights activist and lawyer.
“By the combined effect of Sections 37 of the 1999 Constitution and 40 of the Data Protection Act, 2023, the collection and usage of personal data is a breach of data privacy by the loan company which has damning legal consequences.”
Inside Chinese-linked loan apps that use APK to avoid scrutiny
Foreign-owned e-commerce platforms have become popular in Nigeria, but their lending businesses that operate via loan apps have come under criticism for their abusive practices. These companies offer quick loans to Nigerians, but often charge high interest rates and harass borrowers who default. This has led to calls for more regulation of their practices.
NINECASH, a loan app which functions via APK file formats, offers loans of between N10,000 and N100,000 to be repaid in seven days. Some customers who spoke to Pluboard said representatives of the organization would call them on the fifth day of their due date to demand repayment, ahead of the company’s seven-days policy.
Under pressure, some customers take out loans from other loan apps to repay, wrapping themselves in a cycle of debt. NINECASH is not the only loan company that offers controversial short-term loans.
Oyindamola Olayanju, a salon owner in Ibadan, Oyo state in southwest Nigeria, needed a loan to repair her hair dryer. She applied to Yeah9ja, a Chinese loan company, and eventually received the loan on April 28 without much hassle. But her experience with Yeah9ja was difficult and unpleasant.
“The experience was brutal because I nearly lost my pregnancy,’’ said Mrs Olayanju, 28, recounting how the lender sent threatening and abusive messages for days to her and her contacts.
Olayanju said she could not repay her loan on time; the company blackmailed her by sending a photo of her to her clients with the false claim that she was a prostitute with HIV and mental illness. The messages prompted a deluge of calls from her relatives, friends and customers.
“The day I was to pay, around 10 or 11 am they had already called my contacts,” she said. “It was the second or third day they sent the picture.”
Checks on WEBrate, an open-source tool, showed that Yeah9ja is hosted by CNNIC-ALIBABA-CN-NET-AP Alibaba (China) Technology Co., Ltd. in the United States. The company has no known contact detail, office or online address where it could be reached for comment.
Lagos-based Pelumi Ajibade was introduced to Cashmama, also a Chinese-owned firm in May 2022. She needed money to support her fashion business and cover her financial needs as student too.
When she was unable to repay the loan on time, the app began to harass her by sending threatening to release her personal information online.
“This is a serious problem that needs to be addressed,” she said. “The Nigerian government needs to take action to protect its citizens from these predatory loan apps.”
Linking the loan apps
Pluboard’s analysis found that some loan apps are part of the same loan app family. Some loan apps have hundreds of other loan apps under its umbrella. For instance, NINECASH is a subsidiary of Cashbus, according to reviews of text messages they sent to their customers which usually appears as “Cashbus/9cash”.
Using WebsiteInformer, an open-source tool, also showed that NINECASH, and Cashsea are both Chinese companies owned by a certain “James Wang.” These companies also share the same email address nt9aaz6r65@protonmail.com. We also found that NINECASH, which is the name that appears on the website, is also known as 9cash, a name used as the domain on the app after download.
The apps have a contentious policy requiring specific details from its consumers in order to access their contacts and photographs. Refusing to comply with these conditions disqualifies a potential user or borrower.
Many loan apps on APK were operating from the Google Play store until 2022 when the Nigerian government, in collaboration with Google Inc. in Nigeria, took action by delisting many that had received numerous complaints about defamation and cyberbullying.
The Federal Competition & Consumer Protection Commission (FCCPC) has since shut down over 18 digital money lenders.
Despite these measures, some of these loan apps have developed ways to stay in business. Many use the APK format, useful to only Android phone. They also create several loan apps with subsidiaries, making it difficult for even regulators to differentiate.
Pluboard attempted to reach NINECASH and Cashsea through their email address nt9aaz6r65@protonmail.com but got no response.
Making use of a websiteInformer, the address for NINECASH and Cashsea was found to be “Office Address: 52 IJIAYE ROAD OGBA-IKEJA LAGOS.” The building houses various businesses, but only one financial company, Opay. When this reporter went to see the building, several residents of the building denied any knowledge of either NINECASH or Cashsea.
Messages sent to service@NINECASH.ng did not also get any response. This medium also reached out to Cashbus on its official email service@cashbus.com also no response was received.
Taking risks and not doing enough
The chief executive of FCCPC, Babatunde Irukera, said the commission does not have enough resources to fully regulate all the digital money lenders.
Google West Africa communication manager Taiwo Ogunkola-Ogunlade, told Pluboard that Google had updated its personal loans policy in Nigeria to curb the menace of loan apps.
“Earlier this year we updated our personal loans policy in Nigeria in compliance with local regulations. As part of this update, we introduced a Personal Loan App Declaration requiring developers to provide documentation of their regulatory compliance,” he said.
“We know users looking for help through loans are often at their most vulnerable and we want to create a safe experience for them. These steps ensure we’re only allowing apps that are authorised by the local regulatory agencies for this type of service.”
Analysts say the lending apps only use APK to avoid Nigeria’s laws.
“The only reason why these loan apps use APK and not on Google Store is because they are not licensed,” Boye Adegoke of Paradigm Initiative Nigeria (PIN), told Pluboard.
“If they are not licensed, that means that they are operating illegitimately and by that, every action that they are taking is already against the law and it is supposed to be punishable by law.”
He said users take risks to patronise organizations that are not recognised by law in Nigeria.
“From my regulatory perspective, I call on the government to hit them with the regulatory hammer because, in the first instance, it’s just saying that they are operating illegally since they are not falling under the regulatory purview of the authorities.
Babatunde Baniboye, the legal, enforcement and regulations lead at the Nigeria Data Protection Bureau (NDPB), said the commission and state regulators were working to sanitise apps on Google Play Store and address other methods of communication used by loan sharks.
He said despite these efforts to sanitise apps, there are still many people who patronise these unlicensed or unauthorised lenders.
“We are not unaware of the other methods through which they illegally reach out to those who patronise them and in many cases those who we now describe as their victims,” he said.
“Through the joint effort of the commission as well as the FCCP and other state regulators, at least we were able to sanitise the ones on the play store application. But on this again, efforts are in motion to make sure that there is no hiding place for any of these apps.
“And beyond the issue of downloading the apps, there are other methods of communication that they use that we are aware of, and all of these would be addressed in a holistic approach.
This work was produced with the support of the Africa-China Reporting Project at the Wits Centre for Journalism, University of the Witwatersrand, Johannesburg, South Africa.
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