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Banks now demand clearance letters from quick loan before granting loans
Quick loan is a loan that is accessible on MTN’s mobile money platform. Quick loan is managed by Letshego (AFB) financial institution.
Commercial banks now demand clearance from the Letshego financial institution before granting loans to customers.
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This is because most people access the Quick loan from the mobile money platform but they do not pay back promptly.
The phenomenon of non-payment has led to numerous impaired loans on the books of Letshego.
Letshego, therefore, decided to use other ways and means to reclaim its funds.
In the latest revelation, other banks’ customers who owe Letshego through the Quick loan have faced challenges in an attempt to access loans from their financial institutions.
The various commercial banks now demand clearance from Letshego (AFB) before granting loans to their customers.
This is really necessary because Letshego probably reported defaulting clients to Credit Rating bureaus in the country.
A customer of Agriculture Development Bank recently asked our team to share our opinion on his experience with the bank. The bank asked him to bring clearance from Quick loan managers, Letshego (AFB) before he could be offered a loan. Below is his story.
“Please, good evening! Please, I need help.
I applied for a loan at my bank (ADB) and they are requesting a clearance form from letshego (AFB), which’s the MTN quick loan provider.
However, I own them and don’t know whether, if I go to their office, they will make me pay their loan first before the clearance form or they will give me a form to fill in and indicate the amount I owe the bank to deduct it at source for them. I’m really confused, boss, as to what to do. Thank you”
The role of credit bureaus
Credit Rating bureaus are a registry of financial records of everyone who has access to financial services in the country.
Financial institutions in the country, from micro-finance to commercial banks, are required to provide the credit history of their customers to the Credit Rating bureaus.
The Credit Rating bureaus, therefore, have become the reference point for financial institutions to enquire about the financial credibility of anyone who applies for a loan.
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Financial institutions, therefore, have the ability to know whether a customer is credit worthy or not. And in the case the customer owes another institution, the customer will be asked to settle with the previous institution before accessing the fresh loans.
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