Is Owing Money a Crime In Nigeria? Understanding the Legal Consequences of Debt

Is Owing Money a Crime In Nigeria?

Owing money can be a stressful and overwhelming experience, but is owing money a crime in Nigeria? In most cases, the answer is no. However, failing to pay debts can lead to legal consequences, and in some instances, criminal charges.

In this blog post, we’ll explore the differences between civil and criminal debt cases, and when owing money can become a criminal offense.


Civil Debt Cases

In most countries, debt collection is a civil matter. When an individual or business fails to pay a debt, the creditor must follow legal procedures to recover the debt.

This typically involves filing a lawsuit, obtaining a court judgment, and then enforcing the judgment through various means, such as wage garnishment or asset seizure.

In civil debt cases, the debtor’s rights are protected by law, and creditors must follow specific procedures to avoid harassment or abuse.

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Criminal Debt Cases

While owing money itself is not a crime, certain debt-related activities can lead to criminal charges. These include:

  • Fraud: Hiding assets, providing false information, or engaging in fraudulent activities to avoid paying debts can be criminal fraud.
  • Bankruptcy fraud: Misrepresenting financial information or concealing assets during bankruptcy proceedings is a criminal offense.
  •  Tax evasion: Failing to pay taxes or hiding income to avoid paying debts can lead to criminal tax evasion charges.
  • Bounced checks or fraudulent use of credit cards: Issuing bad checks or using credit cards with intent to defraud can be criminal offenses.
  •  Debt-related harassment or threats: Using threats or harassment to collect debts can lead to criminal charges.

Is Owing Money a Crime In Nigeria?

Owing money is not a crime in Nigeria, but there are exceptions. In most cases, debt repayment is a civil matter, and creditors will seek legal action to recover their debts through the courts.

However, if there is fraudulent activity involved, such as issuing dud checks or obtaining loans fraudulently, criminal charges may apply.

When Owing Money Becomes a Crime

So, when does owing money become a crime? In general, it’s not the debt itself that’s criminal, but rather the actions taken to avoid paying it. Here are some examples:

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1. A business owner hides assets and provides false financial information to avoid paying debts.

2 An individual uses credit cards knowing they have no intention of paying the bills.

3 A taxpayer fails to report income to avoid paying taxes and debts.

In these cases, the debtors’ actions have crossed the line from civil to criminal, and they may face fines, imprisonment, or both.

Is loan default a criminal offence in Nigeria?

Loan default in Nigeria is not considered a criminal offense, but rather a civil matter. However, there are some exceptions and additional details to consider.

Criminalization of Fraud: Loan default can become a criminal offense if there is fraudulent activity involved, such as issuing dud checks or obtaining loans through fraudulent means.

Debt Recovery Process: Creditors can use legal means to recover debts, including sending demand letters and taking legal action.

Role of Law Enforcement: Law enforcement agents should not be involved in debt recovery, except in cases where criminal activity is suspected.

Consequences of Non-Payment: Failure to pay debts can lead to legal consequences, including court judgments and seizure of assets.

Importance of Legal Action: Creditors should seek legal advice and follow the proper legal procedures for debt recovery to avoid any potential liabilities.


What happens if you owe the bank money and don’t pay?

If you owe a bank money and don’t pay, several consequences can follow:

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1. Late fees and penalties: The bank will charge extra fees and penalties, increasing the amount you owe.

2. Interest accrual: Interest will continue to accrue on the outstanding balance, making it harder to pay off the debt.

3. Credit score impact: The bank will report the missed payments to credit bureaus, significantly lowering your credit score.

4. Collection activities: The bank’s collections department will contact you to try to recover the debt.

5. Legal action: The bank can file a lawsuit against you, obtaining a court judgment to seize assets or garnish wages.

6. Account closure: The bank may close your account and report you to ChexSystems, making it harder to open new accounts.

7. Worsening financial situation: Ignoring the debt can lead to a snowball effect, causing financial difficulties and stress.

It’s essential to address the issue by:

  • Communicating with the bank
  • Seeking financial advice
  • Exploring debt restructuring or settlement options
  • Prioritizing payments to minimize damage

Remember, ignoring the debt won’t make it disappear; take proactive steps to resolve the issue and protect your financial well-being.


Owing money can be a difficult and stressful experience, but it’s essential to remember that debtors’ rights are protected by law. While failing to pay debts can lead to legal consequences, it’s not typically a criminal offense.

However, engaging in fraudulent or illegal activities to avoid paying debts can lead to criminal charges.

If you’re struggling with debt, it’s crucial to seek advice from a financial advisor or legal professional to ensure you’re taking the right steps to resolve your debt issues.


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