The Post-COVID Money Lender: Lessons from 2020-2025

It's been five years since the world shut down. Five years since "unprecedented times" became our daily reality. The money lending business was never the same after March 2020, and if you're still standing today, you've learned some brutal lessons.

Here's what survived the crucible.

The Fragility of Income Streams

Pre-COVID, we assessed income reliability based on job stability and business track records. COVID taught us that "stable income" is an illusion. Government lockdowns evaporated income streams overnight. Salaried employees at "secure" companies found themselves jobless within weeks. Small businesses that had operated for decades closed permanently.

The lesson: Income source diversity matters more than income source stability. A borrower with three modest income streams survived better than one with a single "reliable" salary. The gig economy workers we once considered risky proved more resilient than formal sector employees. They adapted faster, found new hustles, pivoted to survival mode.

Now when I assess borrowers, I don't just ask "what do you do?" I ask "what else can you do if that stops tomorrow?"

The Collateral Collapse

Physical assets lost value catastrophically during lockdowns. Commercial property became worthless when businesses closed. Vehicles depreciated faster than loan principals when nobody was driving. Household items we once accepted as security became impossible to liquidate - nobody was buying when everyone was selling to survive.

The only collateral that held value: land in specific locations, gold, and surprisingly, mobile money transaction history.

The lesson: Collateral is only as valuable as the market's ability to absorb it during a crisis. We learned to accept smaller loan amounts relative to collateral value, or to demand more liquid forms of security.

More importantly, we learned that transaction history became the new collateral. A borrower's mobile money records showing consistent incoming and outgoing flows proved more valuable than physical items gathering dust in a locked shop.

The Integrity Test

COVID separated the wheat from the chaff in ways no normal economic cycle could. The true character of borrowers revealed itself under pressure.

Some borrowers who lost everything still communicated honestly, kept us informed, and paid back whatever they could when they could. Others who still had capacity disappeared, blocked our calls, and invented elaborate excuses while we later discovered they were operating as usual.

The surprising discovery: Some of our "vampire" borrowers - those running multiple concurrent loans - proved more reliable than our "principled" borrowers. Why? The vampires understood that burning a lender meant losing future access to credit. They needed the relationship to continue. The principled borrowers who only borrowed occasionally felt less stake in maintaining the relationship.

The lesson: Character isn't revealed in good times. It's revealed when paying you back conflicts with immediate survival. The borrowers who stayed in communication during their worst moments are now our most valued clients.

The Death of Fixed Payment Schedules

Pre-COVID, we operated on rigid payment schedules. Monthly payments due on specific dates. This broke completely when income became irregular and unpredictable.

The lesson: Flexibility became survival. We learned to negotiate payment plans that matched irregular income flows. Daily micro-payments through mobile money. Payments tied to specific income events rather than calendar dates. The borrowers who survived were those whose lenders adapted payment structures to economic reality.

The rigid lenders lost everything trying to enforce pre-COVID terms in a post-COVID world.

The Regulatory Chaos

Governments responded to COVID with contradictory policies. Interest rate caps that made lending uneconomical. Eviction moratoria that eliminated our ability to recover collateral. Debt forgiveness programs that encouraged borrowers to default strategically.

The lesson: Political risk now exceeds credit risk in many markets. We learned to maintain lower loan volumes and higher liquidity ratios. Better to have capital idle than trapped in loans we legally cannot collect because a politician decided to buy votes with debt forgiveness.

The Technology Acceleration

COVID forced everyone online. Mobile money penetration exploded. Digital record-keeping became essential when face-to-face meetings stopped.

The lesson: Borrowers with digital footprints became assessable in ways impossible before. We could verify income through mobile money statements, track spending patterns, assess business viability through online presence. The analog borrowers became increasingly risky - not because of their character, but because we couldn't verify anything about them.

The New Borrower Types

COVID created new categories:

The COVID Casualties: Lost everything and never recovered. Dead capital sources. Write them off and move on.

The COVID Survivors: Barely hanging on, perpetually restructuring. High maintenance but might eventually recover. Requires judgment on whether to support or exit.

The COVID Thrivers: Found opportunities in chaos. New businesses, new income streams, adapted faster than the market. These became our new cash cows - but with caution, because rapid success can reverse just as quickly.

The COVID Opportunists: Took advantage of debt forgiveness programs, eviction moratoria, and lender desperation. Borrowed knowing they wouldn't pay back. Our new charlatans, but wearing masks of victimhood.

The Capital Preservation Imperative

Many lenders went under not from defaults but from being unable to collect performing loans during lockdowns. Capital was there but inaccessible.

The lesson: Liquidity buffers must be larger than we ever thought necessary. The old ratios don't work. We now operate with 30-40% idle capital just to survive the next shock. This makes us less profitable in normal times but ensures survival in abnormal times.

And we've learned that abnormal is the new normal.

What Works Now

Five years post-COVID, here's what actually works:

1. Smaller loan sizes relative to income and collateral
2. Shorter loan terms - 3 months maximum for new borrowers
3. Digital verification of everything verifiable
4. Flexible payment structures tied to actual cash flows
5. Premium pricing for the increased risk we're absorbing
6. Ruthless early action on warning signs
7. Maintained relationships with performing borrowers even when they don't need loans

What Doesn't Work Anymore

1. Lending to single-income-source borrowers regardless of that income's "stability"
2. Accepting physical inventory or commercial property as primary collateral
3. Fixed payment schedules
4. Long-term loans to anyone without multi-year track record
5. Lending to borrowers without digital transaction history
6. Trusting government promises about regulatory stability
7. Maintaining high deployment ratios of available capital

The Philosophical Shift

The biggest lesson isn't operational - it's philosophical. Pre-COVID, we operated with the assumption that economic systems were fundamentally stable with occasional disruptions. Post-COVID, we operate with the assumption that disruption is constant and stability is temporary.

This changes everything about how we assess risk, structure loans, price credit, and choose borrowers.

The money lenders who survived COVID weren't necessarily the most skilled or the most capitalized. They were the most adaptable. They were willing to abandon practices that worked for decades when those practices stopped working overnight.

In 2025, adaptability is the only sustainable competitive advantage.

The game hasn't just changed. The rules no longer apply. And the borrowers who understand this are the ones we want to work with.

Because when the next disruption comes - and it will come - we'll need borrowers who can adapt as fast as we've learned to.

Stay flexible. Stay liquid. Stay alive.

Red Flags I've Learnt to Spot in the First Five Minutes

I can tell you within five minutes whether I'm going to lend you money. Not always, but most times. After years of sitting across from borrowers—in tea shops, in their workplaces, in my small office—I've developed pattern recognition that saves me from expensive mistakes.

Here's what makes me reach for reasons to say no before we even discuss terms.

The Verbal Red Flags

"I just need a small amount"

When someone opens with this, they're managing my expectations downward before I've even stated my concerns. It's a pre-emptive strike against rejection. The issue isn't the amount—it's the psychology. People confident in their ability to repay don't minimize the significance of what they're asking for.

Small or large, money is money. The "just" tells me they expect me to dismiss the risk because the amount seems trivial. But I've lost more money on "just small amounts" than on large, properly structured loans.

Over-explaining why they need the money

A borrower who launches into an elaborate story about why they need the loan without me asking is often constructing a narrative to manipulate sympathy rather than demonstrate capacity to repay.

"My child is sick, school fees are due, my mother's funeral, business stock got stolen, landlord is threatening..."

The tragedy Olympics. Each story more heartbreaking than the last.

Here's what I've learned: people with genuine emergencies and genuine capacity to repay state their need simply. "I need 500,000 for medical bills. I can pay back 600,000 in three months from my salary." Done.

The elaborate storytellers are building an emotional case because they don't have a financial case.

"I've borrowed from others and paid back"

When this is volunteered without me asking for references, it's often false or misleading. If you have a good track record with other lenders, I'll find out when I ask. You don't need to front-load this information unless you're worried I won't believe it when I verify.

Real references come with names and phone numbers I can call. Vague claims about paying back "other money lenders" are usually smoke.

"I know I can get money from elsewhere but I prefer to work with you"

If that were true, you wouldn't need to tell me. People with options don't announce their options. They negotiate. This statement is almost always a bluff to appear less desperate than they are.

The subtext: "I've been rejected elsewhere and I'm hoping you don't find out."

Speaking badly about previous lenders

"The other money lender was charging too much interest. He was cheating me. He's a thief."

If you speak badly about your previous lenders to me, you'll speak badly about me to the next one. More importantly, if every lender you've worked with "cheated" you, the common denominator is you, not them.

The exception: when someone calmly explains they completed their obligation with another lender but found the terms difficult. That's honest reflection, not character assassination.

"Trust me"

Nobody who should be trusted says "trust me." It's the verbal equivalent of a con artist's handshake. Trust is demonstrated, not declared.

When someone asks me to trust them in the first conversation, they're really saying: "I don't have enough evidence to make you comfortable, so I'm appealing to your goodwill instead."

The Behavioral Red Flags

Too eager to agree to terms

I quote interest rates and repayment schedules. A borrower who accepts immediately without negotiation or even mild surprise is either desperate or has no intention of paying those terms.

People who plan to repay push back a little. They negotiate. They ask questions. They want to understand exactly what they're committing to because they're actually planning to honor that commitment.

Instant agreement means they're saying whatever I want to hear to get the money today. Tomorrow's problem is tomorrow's problem.

Inability to look me in the eye

Not foolproof—some people are just shy or culturally conditioned to avoid direct eye contact with people they perceive as authority figures. But when combined with other signals, chronic eye aversion is a flag.

Liars and people carrying guilt struggle with sustained eye contact. If you can't look at me when you're asking me to trust you with my capital, why should I?

Dressed too well for their stated situation

Someone claiming financial distress but wearing expensive shoes, new clothes, or showing up in a relatively new car raises questions. Either the distress is exaggerated, or they have a spending problem that created the distress.

The inverse is also true but less concerning. Someone dressed poorly but requesting a small amount for genuine emergency is consistent. I can work with consistent.

Checking their phone constantly

During our first meeting, if you're glancing at your phone every minute, you're either not serious about this transaction or you're coordinating something else. Neither inspires confidence.

People who need money and have capacity to repay give the lender their full attention. Your phone can wait fifteen minutes.

Bringing an entourage

One trusted advisor or witness? Fine. Three or four people "for support"? Red flag.

Large groups serve two purposes: to pressure me through numbers, or to diffuse responsibility. If things go wrong later, everyone in that room will claim they weren't really part of the decision.

I've learned to insist on one-on-one conversations. If you need your entire family present to ask me for money, you don't have the confidence or authority to make financial commitments.

The Documentation Red Flags

"I forgot my ID"

Nobody forgets their ID when coming to borrow money. You might forget it for a casual meeting, but when you're asking someone for capital, you know what's required.

"I forgot" usually means "I don't want you to verify my details" or "the ID I have doesn't match the story I'm telling you."

I've had borrowers whose national ID shows they're younger than they claimed, or whose ID address contradicts where they said they live, or whose name on the ID differs from the name they gave me. The forgotten ID is often a last-minute panic move.

Reluctance to provide workplace contact

"My boss doesn't like personal calls."
"Our office doesn't allow visitors."
"I'll give you my colleague's number but don't call during work hours."

If I can't verify your employment, I can't verify your income. If you're reluctant to let me confirm the single most important factor in my assessment, we're done here.

The only exception: people in genuinely sensitive positions (certain government roles, security services) where employment verification has to go through official channels. But even then, there's a process. Vagueness is not a process.

Offering photocopies instead of originals

Photocopies can be doctored. Originals can't, at least not easily. When someone only has photocopies of critical documents—land titles, business licenses, employment letters—I assume the documents are problematic.

Either they're not the actual owner, or the documents are fake, or there's an encumbrance they don't want me to discover when I verify with the issuing authority.

Incomplete or suspiciously neat paperwork

Real business records are messy. Real employment letters have coffee stains and fold marks from being carried in a bag. Real life is imperfect.

When someone presents me with documents that look like they were printed yesterday for this meeting—suspiciously clean, perfectly formatted, no wear—I'm immediately skeptical.

Conversely, when paperwork is so disorganized that nothing matches and nothing can be verified, that's also a problem. There's a sweet spot: organized enough to be credible, worn enough to be authentic.

The Inconsistency Red Flags

Story changes between first phone call and meeting

On the phone: "I need 300,000 for school fees."
In person: "Actually, I need 500,000 for stock for my business."

If your story shifts between initial contact and face-to-face meeting, either you weren't honest initially, or you're making it up as you go. Neither builds confidence.

Numbers don't add up

"I earn 800,000 per month."
"My rent is 400,000, school fees 300,000, transport 100,000, food 150,000..."

That's 950,000 in basic expenses for 800,000 income. Before we even discuss loan repayment. This math fails.

Either you're lying about your income, or you're lying about your expenses, or you genuinely can't manage money. None of these scenarios make me want to lend to you.

Collateral doesn't match the request

"I need 1 million. I can give you my car as security."
"What kind of car?"
"A 2005 Premio."

A 2005 Premio in average condition might fetch 4-5 million if you're lucky. So why are you only asking for 1 million? Either the car has problems you're not disclosing, or you're planning to borrow from multiple people using the same collateral.

When collateral is significantly overvalued relative to the request, something is wrong.

The Desperation Red Flags

"I need it today"

Genuine emergencies happen. Medical crises, sudden evictions, unexpected deaths. These are real and I've financed them.

But when someone needs money "today" and their reason isn't genuinely urgent, they're often running from something. Maybe another lender's deadline. Maybe a threat. Maybe consequences of previous poor decisions.

Desperation clouds judgment—theirs and mine. I've learned to slow down when someone wants to speed up. The faster they want the money, the slower I move.

Offering to pay higher interest without me asking

"I know money lenders charge 20%. I can pay 25%."

Why would you offer to pay more than I'm asking? Either you're desperately trying to make yourself attractive, or you don't plan to pay back any of it so the percentage is irrelevant.

People who plan to repay negotiate downward, not upward.

Multiple calls before we meet

Three calls in two hours asking if I've "thought about it" or "made a decision" before we've even sat down? This is pressure, not persistence.

It signals that you have a ticking clock I don't know about. And whatever you're not telling me about that clock is going to become my problem if I lend to you.

The Entitlement Red Flags

"I know you'll help me because..."

Because we go to the same church. Because we're from the same village. Because someone introduced us. Because you're a Christian. Because we're both businesspeople.

Any appeal to solidarity, shared identity, or moral obligation is a red flag. Business is business. If your case is strong, it stands on its own merits. If it's not strong, wrapping it in social pressure doesn't improve it.

Speaking as if approval is certain

"So when can I pick up the money?"
"How soon can you process this?"
"I'll need it in cash."

We haven't even agreed on terms and you're already assuming approval. This presumption suggests you're not used to hearing no, which means you're either very privileged or very delusional. Neither makes you a good credit risk.

Questioning my right to ask questions

"Why do you need to know that?"
"That's personal information."
"Are all these questions necessary?"

Yes. They are. I'm giving you my capital. I have the right to ask anything I deem necessary to assess risk. If you find my due diligence intrusive, you're free to seek money elsewhere.

The best borrowers understand this. They come prepared. They answer questions fully. They volunteer information I haven't even asked for because they want me to feel confident.

The entitled borrowers act like I should feel privileged to lend to them.

What Five Minutes Actually Tells Me

These red flags aren't absolute. Good people sometimes exhibit them. Bad people sometimes hide them well. But after years in this business, pattern recognition is my most valuable tool.

Five minutes tells me:

• Whether you're honest or performing honesty
• Whether you're desperate or just in need
• Whether you've planned this or you're winging it
• Whether you respect my process or resent it
• Whether this is business or emotional manipulation

I've ignored these flags before. Always regretted it. Every single time.

The expensive lesson I paid for repeatedly: When I feel uncomfortable in the first five minutes, I'm usually right.

Your gut is pattern recognition your conscious mind hasn't articulated yet. Mine has been calibrated by losses I couldn't afford to take and took anyway because I wanted to believe people were better than the red flags suggested.

Some were. Most weren't.

The Green Flags I Look For Instead

Since this post is about red flags, I should mention: there are green flags too.

• Calm, straightforward explanation of need
• Realistic assessment of repayment capacity
• Prepared documentation without me asking
• Willingness to start with a small loan to build trust
• Questions about my requirements rather than assumptions
• Speaking respectfully about previous lenders even while explaining why they're looking for alternatives
• Bringing realistic collateral or accepting to borrow within their means
• Understanding that I'm running a business, not a charity

These people exist. They're why I'm still in this business.

But they're rarer than they should be. Which is why I've gotten very good at spotting what's wrong in five minutes, because I can't afford to spend thirty minutes discovering what my instinct already knew. 

What Every Young Entrepreneur Must Understand About Informal Loans

 I have lent money to many young entrepreneurs. Some grew into dependable partners. Many disappeared. A few taught me expensive lessons. 

If you rely on informal loans to run your business, here is what you must understand — not from theory, but from the lender’s seat.

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1. When I Lend to You, I Am Not Investing in Your Dream

Your passion does not repay loans. Your vision does not repay loans. Your hustle does not repay loans.

Cash flow repays loans.

When I give you money, I am not buying into your dream. I am temporarily giving up control of my capital and taking a risk that you will return it — with interest — on time.

From my side, lending is not emotional. It is exposure.

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2. I Watch Your Behaviour More Than Your Business

I pay close attention to:

• how you communicate,

• how you respond under pressure,

• whether you keep your word when it is inconvenient.

Your business may fail. That happens. What I am really evaluating is your character under stress. Most borrowers think lenders judge ideas. We don’t. We judge behaviour.

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3. You Are Being Classified After Every Loan

After each transaction, I silently place you into a category:

• reliable,

• negligent,

• risky,

• dishonest,

• or never-again.

I do not announce this. You feel it later — when you need money and I suddenly become unavailable.

From my side, memory is long. Capital is cautious.

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4. Excuses Are More Damaging Than Losses

If you tell me early that you are struggling, I can work with you. If you disappear, lie, or create stories, you force me to assume the worst.

Silence tells me:

• you are dishonest, or

• you do not respect my capital.

Either way, trust dies quickly. I would rather deal with a borrower who failed honestly than one who delayed dishonestly.

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5. I Do Not Lend Against Hope

When you say:

• “This deal will work,”

• “Money is coming soon,”

• “Once I close this contract…”

What I hear is uncertainty. I lend against control, not optimism. If repayment depends on luck, timing, or other people behaving perfectly, then the loan is already unsafe.

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6. Collateral Exists Because Trust Is Incomplete

Collateral is not a favor to you. It is insurance for me. If I insist on collateral, it means:

• I am not yet convinced of your reliability, or

• your past behaviour created doubt.

As trust grows, collateral matters less. As trust shrinks, collateral becomes mandatory. This is not personal. It is protection.

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7. My Best Borrowers Are Boring

The borrowers I value most:

• repay without reminders,

• communicate clearly,

• do not dramatize problems,

• do not negotiate after default.

They are predictable. They are quiet. They are disciplined. They are not exciting — and that is exactly why I lend to them again.

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8. My Capital Has Limits

Every unpaid or delayed loan ties my money down. That money could have helped someone else. When you default carelessly, you are not just hurting me. You are blocking opportunities for other borrowers. From my side, protecting capital is protecting the entire system.

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What I Actually Want From You

If you want long-term access to informal credit, understand this:

• Borrow what you can control, not what you desire

• Communicate early, not defensively

• Repay on time, not with explanations

• Treat my money with the same seriousness you treat your own

Do this consistently, and I will not need collateral. I will not pressure you. I will look for you when capital is available.

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My Final Word 

Informal lending has no contracts that truly protect me. No credit bureaus. No guarantees.

All I have is your behaviour.

So remember this:

Your reputation is your real collateral.
Your discipline is your real credit score.

Lose either, and no amount of excuses will bring my money — or my trust — back.

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