Nigerian Sterling Bank launches social media lending platform
Nigeria's Sterling Bank has launched a social media lending platform offering customers the opportunity to borrow small amounts over Facebook or Twitter.
Nigeria’s Sterling Bank has launched a social media lending platform offering customers the opportunity to borrow small amounts over Facebook or Twitter.
Working with Lagos-based Bincom ICT, the bank has created what it describes as a modified peer-to-peer lending solution that allows to users to borrow through social media, starting with Facebook and Twitter.
Head of social media Kelvin Steve-Igbodo, said: "At Sterling Bank we realise that one of the basic functions of a bank is to provide loan access for its customers, but we have also observed that the inconvenience of the processes often dissuades potential customers from applying for loans.
"With the emergence of social banking on our various online platforms, the need to issue loans online has become relevant and this is why Sterling Bank has taken the initiative to develop a service that would make it easy for those who are active online to access micro credit."
Customers of the lender who follow it on social media can apply for loans by visiting the website, where they will be rated according to an algorithm that calculates their social reputation using various criteria.
The bank said that data sourced from the user’s social media presence increases the social reputation score that decides whether they will be granted their loan.
A borrower can borrow up to NGN3000 ($18.37) in one go at a flat cost of NGN100 and has a month to pay the money back. This would equate to an APR of 48.2%.
Although the platform is based around social media, for privacy reasons the bank does not post anything on the user’s Twitter feed or Facebook timeline.
Steve-Igbodo added: "This application will integrate with existing financial structures of the bank such that users of the online platform can access small loans by normal methods of withdrawing cash without collateral.
"These funds are easy to access and are delivered via a convenient platform."