No Credit, No Problem
Nigeria is not a totally bad place to live in if you take out corruption and insecurity. It's understandable why there are people who think it isn't necessary to leave Nigeria because it's easier to thrive here assuming you have a growing business or a good-paying job here.
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When we actually consider liabilities such as mortgages, credit card debts, student loans, car loans, and the likes, we have it easy here. We don't run a credit-based system here and it's favorable for most people I guess.
I often think about what living abroad would be like and how I would adapt to an entirely different system. I have never had to take a loan in my life, and neither have my parents. Our mindset has been endurance always rather than falling into a pit of debt.
On the other side of the world, however, it seems they live on loans and it's hard for me to comprehend. The concept of a mortgage is foreign to me because over here, we pay for houses straight up or we buy land and build the house to our taste.
There isn't a student loan system here, I don't even know how that works. You want to go to school? You have to pay your fees first. We don't go to school on credit here.
The first time I saw a credit card I was shook. I should have asked if the person actually uses it here in Nigeria and how it works. All I know is a debit card and spending exactly what I own. All of that credit score thingy is like looking at weird codes and having no idea what it means.
You want to buy a car? You just walk into the dealership store, pay the full price and go home with your car. You do all of the necessary registrations and you're good.
There are services that offer different payment plans but it's entirely up to you if you want to go with that. Majority of the populace pay for their cars immediately.
Basically, if you live in Nigeria and you have an average income source, your liabilities are generally no way near an average income earner abroad.
Developed countries don't play when it comes to databases, something Nigeria is terrible at. On that basis alone, a credit system would totally flop here. No credit system, less liabilities.
Keeping up with personal finance is hard as the economy keeps getting wrecked every day and I often wonder what it'd be like in a different country where they seem to pay for everything and live on credit.
I have never owed a major debt before and I am overwhelmed by the thought of spending on credit. How does one maintain a asset > liability mindset in a place where they offer to give you everything on credit?
What's it like living on credit? I'm clueless and will have to do my homework.
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Keep working hard and having goals as well as dreams and you will achieve them.
Sounds like your area needs quite a bit of help and support.
I wish you great success on all of your investments and trading here on the blockchain hopefully this will lead to more opportunities and you being able to influence your local area more.
The more that we all grow and interact the better off humankind really is.
Thank you! I hope I can improve myself so I can do better for those I care about.
Are you involved with the diesel pools?
I have a feeling you're doing really well at trading already.
Were you able to get your account automated?
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Oh they do have databases, but they are in files and folders that are stored away in some rat and cockroach infested store that nobody remembers exists.
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Poor excuse for a database 😄
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This shocks me but I dont think it's a bad thing.
I don't think so too
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Its really scary now that I've thought of it. Imagine all the expenses we take care of over here on a daily basis then think of being able to settle them all on credit. Ómo it's like piling up your death sentence. Las las you go still die in debt.
Las las I guess there's something positive in our negative situation. But then we still have to get rid of the whole corrupt system, naija for be a better place by now
An average Nigerian would run into debts if we lived on credit.
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It has its pros though! Not like most Africans who are naturally proud would still take to living off credit but it does has its benefits.
One of them is this, let's say you have 100k saved up at an annual percentage rate of say 10%, and then you spend 10k say on a new car "on credit" at the end of the year you wouldn't have spent any money out of your original 100k, you will have a new car and life goes on.
I am sure there are also lots of cons but the important thing is learning to balance your finances the best way we can.
Paying for a property/service at once sometimes could be hemorrhaging to one's finances, that's why we hear stories in Africa like "because your sister got into the university this year you would have to wait till I can get back on my feet" or "I can only send a son to school". Lack of financial flexibilities has made us seem stupid.
Last year I was in a bus with a lady that was bleeding. According to her, it was because she just lost her baby and was returning from the hospital at the time. Everyone on the bus made her feel like shite by spitting, wincing and even getting off the bus. I was so embarrassed for her and would have personally taken a loan to get her a car so she doesn't have to share such private moments with complete strangers in the future and I'm certain her husband would have probably done the same but he would probably have to work for 2 years to be able to afford that while the family has to endure so much.
A Credit free life is most definitely bliss but being able to get the amount of money you need per time is a gift.
Ciao
But one wouldn't even be offered that much percentage in the first place in Nigeria.
Knowing Nigerians and their attitude to debt, hmm, finding that balance is hard.
If one can find the balance, living the credit life is easier. You can carry on with several plans at the same time.
The story about that woman is so sad.
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If Nigeria had credit ehn!!! The poverty rate would be a lot worse than it currently is. Our banking system is already quite unfavorable, imagine being able to owe them for the smallest things and then imagine the zeal they’ll use to come after defaulters. Abeg o. Na money wey dey your pocket be your own.
See the way Nigeria owes other countries, it's in our personalities to borrow more than we can pay 😂
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Exactly 😂
Thank you! Makes you wonder when we would ever see changes. On a different note, if Nigeria adopts a credit system, best believe citizens will be frustrated to stupor.
Too many people would falter. It will be another pandemic.
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You really hit on something here! Debt is a silly game that we play in so-called rich countries. The ones who have a lot can benefit greatly and the ones who don’t get screwed.
I used to hate the idea of owning a credit card but after a lot of arguing with my parents I agreed to keep one just for emergencies. I see how my mother spent $350 on a $200 jacket because she always paid the minimum credit card fee every month and accrued interest. It seemed so dumb to me. She fell into the is trap over and over. Another trap is when you buy stuff you can’t afford and the government takes your house or assets as collateral.
Now I realize there are ways to play and win though. If you have a steady income and lots of savings or investments, you can leverage those and use credit to live in order to take advantage of inflating currency. There are loans that are low interest, I don’t know much about them but there are games to play where you can win, but basically you have to have money to play them.
I wish we’d just obliterate this whole debt system though. I think crowdfunding and government assistance should be more readily available as a last resort but less easy to abuse and then fuck all these traps.
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This is so scary to me. A whole lot of people would suffer if we lived like that here.
It's only favourable to the mid and rich people then. It's just a huge debt trap for the lesser privileged.
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Honestly, that is it!!
That aspect of credit card, if it exists in Nigeria, then our economy would be ready to go down the drain. Very well, relatively, it is kind of okay to live here in Nigeria than those countries we call greener pastures!
Yeah...if certain things can be corrected our grass would be greener. But it looks like we're way past that.
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Yes, I totally agree with that, honestly. But those who would champion that cause must be ready to die for it, but who is?
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Debt is something that has to be carefully managed. In my opinion, they really try to mess you up. It is almost impossible to purchase a home without a mortgage here unless you are rich. The only people I know who have done it were millionaires. And I only know of two people who have done it.
What's crazy is how easy it is to get credit. Furthermore, if you don't have a credit card, mortgage, or some history of debt and repayment, they consider you a loan risk -- your credit score will be low.
On the other hand, despite the fact that I earn less than the "low income cut off," which we also sometimes call the "poverty line," I have access to credit in excess of one year of my income. I can ask the bank and credit card companies to remove my credit, but then, later, if I want a mortgage, this will be viewed unfavourably.
Rather, I keep the access to credit, but I only use as much as I need and pay the bill every month so I don't pay interest. Some people consider credit to be money that can be spent. The credit card companies encourage this thinking and it lands many people in difficulties.
In a "developed" country, trying to get by with no credit card is difficult. For example, it is almost impossible to get a hotel room or rent a car without a credit card. This is why so many people run into problems with credit. We need it and then it is tempting to buy more than you require or can afford.
I have certainly made mistakes in the past, but now, I manage my credit well. In the current system, unless I find a way to increase my income, actually owning a dwelling seems impossible. I cannot save up enough because the rent is so high. However, they will not give me a mortgage because my income is so low. Ironically, people in my income bracket cannot get a mortgage because the bank thinks we are too poor to repay it. However, instead, since I musr live, I pay rent that is as high or higher than the mortgage payment the bank says I cannot afford. Despite always paying my rent in full and on time, I can never own my place unless my economic circumstances change.
This is an explanation of our system, not a complaint. I think, here in Canada, we are very fortunate in many ways. Also, despite being poor on paper, I am fortunate because I do not feel poor. This is partly because I keep my expenses low and try to rein in my desires. However, it is also because my fiancé pays more than his share of the bills. We decided to split the bills in an income-proportional way. He is not rich either, but this makes it so neither of us feels strained.
Thank you for coming through @harlowjourney! This was quite the explainer. I understand it now to an extent.
Not being able to get a mortgage and still pay rent that's higher is wild. I'd assume if the records show that you're regular with rent, then you can afford mortgage.
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You can also say the same about my country (Hungary). And probably about many other countries.
And the same is true for other parts of your post.
I live in Hungary, and I do not even have an a average income source (mine is less than the average, even less than the local minimum wage), but even if I would have the average, your sentence would be still true. The Hungarian average income is much less than in other European countries.
Have a nice day. All the best. Greetings and much love from Hungary.