Loan defaults make digital credit expensive for everyone — MobileMoney Fintech CEO

The Chief Executive Officer (CEO) of MobileMoney Fintech Ltd, Shaibu Haruna, has urged digital finance users to borrow responsibly, warning that loan defaults ultimately increase borrowing costs for everyone in society. 

He explained that while digital lending had expanded access to credit for millions of first-time borrowers, customers also had a responsibility to repay loans and use borrowed funds for productive purposes. 

Speaking to the media after a session of the just-ended 3i Africa Summit in Accra, Mr Haruna stated that high default rates force lenders to factor additional risks into pricing, making digital loans more expensive across the market.

“It’s actually cool to borrow and pay; it’s actually not cool to borrow and not pay,” he said.

Shared responsibility

Mr Haruna explained that discussions at the summit focused heavily on balancing rapid expansion in digital credit with stronger consumer protection measures to ensure long-term sustainability of the sector. 

He said that digital lending had created unprecedented access to credit for first-time borrowers in Ghana and across Africa, but stressed that both lenders and consumers had responsibilities in maintaining a healthy financial ecosystem. 

He said lenders must ensure transparent pricing and fair lending practices, while customers must also honour repayment obligations to keep borrowing costs low for everyone. 

“When you borrow, there is an expectation that you also meet your obligation, so that the cycle of borrowing would also continue,” he stated.

He added that transparency remained central to building customer trust in digital financial services, especially as more consumers increasingly relied on mobile-based loans for personal and business activities. 

Improving loan performance

Mr Haruna stated that MobileMoney Fintech Limited had continued to rely on artificial intelligence, data analytics and digital scoring systems to strengthen its lending operations and reduce default risks. 

He explained that the use of data mining tools had enabled the company to better assess customer behaviour and determine creditworthiness more accurately. 

He said the company’s non-performing loan ratios had shown steady improvement over the years due to advances in data-driven lending systems and enhanced customer engagement strategies.

He stated that despite concerns about loan defaults, the majority of customers continued to repay their loans responsibly. 

Mr Haruna said that the company had intensified customer engagement and education efforts through its Responsible Borrowing Campaign to encourage timely repayment and proper loan usage. 

“Most of our customers do pay, and the non-performing loan ratios on our platforms continue to improve year after year,” he said.

Building trust 

The CEO stressed that customers needed to utilise borrowed funds for productive purposes to ensure they could repay on time and maintain access to future credit opportunities. 

He explained that when borrowers defaulted, lenders were compelled to factor those risks into pricing structures, which ultimately increased the overall cost of borrowing across the market. 

Mr Haruna urged consumers to adopt responsible borrowing habits to support the sustainability of the country’s growing digital finance industry. 

“It’s actually cool to borrow and pay; it’s actually not cool to borrow and not pay,” he added.