The importance of money in life can never be underestimated, just like the air we breath – we can’t do without it. In fact, it is almost like the opening key to the basic necessity of life, ranging from food to shelter, to clothing etc.
Malnutrition which is responsible for about 300,000 deaths annually for children under the age of 5, is caused by lack of food and it is largely a thing of poor countries, ditto for homelessness which another poverty induced problem. As I write, statistics from World bank puts the no of homeless people in Nigeria around 108million. Read more about this here. So if you have money, you can build or buy the kind of house you want and eat anything you like.
All these point to the fact that we can’t do without money. You either own one, beg or borrow. Those three things are sure.
In a developing country like ours, it is a fact that many don’t have, some have decided to beg why some are looking for who to borrow them to pay back. If you are in the last shoe, looking to borrow for one reason or the other or you want to lend someone some money, here you 5 important things you need to consider before going ahead.
- Ensure you have a means of paying back: It is common here that some people can borrow from anywhere available and by any means. Some will borrow out of urgent need when they may never pay back in years, just to solve their problems, forgetting that the owner might have other better use for his or her money but for sacrifice, wants to help. In fact some borrow with the intention not to pay back at all, thinking you have excess to throw around. If you must borrow, to be able to borrow again, Be sure you can pay back. Once beaten twice shy. A Yoruba African Proverb says Òjò a ma pani wo ilé kan lemeji” – Rain can beat you twice into the same house. If you have spoiled things, no one will rescue you.
And for lenders, if you must give out your money, be sure you know the person well and have means of paying back. Even banks don’t borrow some people money. Not for unfairness, but for avoiding risks. Avoid the risk, rather give out the little you have without expecting anything back. If he comes for N20,000, you can tell him I don’t have money to borrow any one o, but I can give you 5,000 freely. Then you keep your 15,000 for better use. I can swear such may appreciate you better than borrowing him 20,000. Be wise.
2. Borrowing for good reasons: You will be shocked to hear funny things people borrow money for. Weddings, burial ceremony, or to cater for expensive taste. I have seen a man with a car who is asking his friend with no car to borrow him money. He feels his friend has money to buy a car, he just doesn’t want to. Yet the friend is saying, yes I can but not now. People in Nigeria will borrow money to do aged burial for spiritual reasons. They call it befitting burial. Lol A man I know decided to do the burial of his father who died forty years ago when he was barely 5yrs because one man of God told him it is because he hasn’t done it right thing for his late father, – a burial, that’s why he hasn’t made it in life. You can imagine and a poor man went to borrow hoping once that is done, he would be rich to be able to pay back. As lenders, be sure you know what people want to use the money for.
Some startup borrow money for unrealistic business plan. “Oh, if you can borrow us 1million naira, with our projection, we will break even in 3months and pay all your money back in 4months. Everything is there for us; the market is there, can’t you see, see thee innovation we are bringing into the system. Nothing can stop our shine again. We mean it”
They forget policies and unforeseen circumstances like it is currently happening with Okada banning in Lagos where investors are already counting their loses.
As lenders, look before you leap. Ensure you are giving your hard earned money to the right person.
Some people even borrow to try unscrupulous Internet business and get scammed. The story of MMM is still there, with many victims. As borrowers, borrow only for good reasons or things you are too sure of. Some risks can wreck you. Be cautious.
3. Avoid killing interest: There are some money lending financial service companies in town today with so many unimaginable interest rate. From banks to Some thrift societies, to local money lenders, the interest are not in the best interest of borrowers. As lenders, be fair. There is a high chances of getting your money back easily when you don’t overcharge for a service. And to you as borrower, there are better money lending start-ups now with fair interest and their are loans you can get at interest free, if you have religion reservations. Be careful! Visit Jaiz bank Nigeria too, to see how you can get loan without interest. Martekmoni is another.
4. Use the money well: Ordinarily we don’t need to advice anyone on this, but you will be shocked to see that once some people receive a loan meant for business in their account like this, that’s when they will remember that the clothes on their 3 seaters sitting room cushion chair is worn out and deserved to be replaced. We have heard of people who took cooperative loan to beer parlor first, to celebrate – only to be robbed. This advice is for borrowers. Use your brain well. Don’t let devil use you. A Yoruba African proverb says “A kii if gbèsè sorun sòsó” – Never spend on luxuries while in debt.
5. Be much concerned about repayment: Once some people get money like this, it sometimes appears as if they have completely forgotten they borrowed this money. And needed to be reminded constantly. As lenders, don’t assume people know they borrow money from you, part of your duty is to stay in touch. Don’t borrow and look away except you are dashing out. As borrowers, strategize and strategize have workable repayment plan for your loan.
Do you find this information in anyway helpful? Please don’t hesitate to drop your comments.