Digital wealth management platform, Yield by Credit Direct cautions Nigerians, especially retail investors, to watch out for common warning signs in investment opportunities, including unusually high promised returns and offers from unregulated or unverifiable providers, before committing their money to any investment.
Speaking at the Nairalife conference, Dr Emeka Ucheaga, Head of Research, Strategy and Financial Inclusion at Credit Direct, walked attendees through a series of real-life investment scenarios during an interactive session, educating the audience while testing their ability to distinguish sound financial decisions from risky ones.
The session, moderated by host and digital creator Enioluwa Adeoluwa, presented attendees with hypothetical investment offers and asked them to vote on whether each represented a “red flag” or a “green flag,” before Dr Emeka broke down the reasoning behind each scenario.
Among the scenarios presented was a forex investment opportunity promising a 25 percent return every month in exchange for an initial commitment of ₦500,000. The scenario was flagged by attendees and Dr Emeka as a red flag.
Explaining his reasoning, Dr Emeka emphasised that the forex market is inherently volatile, and a profit made in one month is not guaranteed to repeat in the next. According to him, this volatility is precisely why any promise of a fixed, consistent monthly return should be treated with scepticism, as no legitimate forex-linked investment can guarantee identical excellent outcomes month after month.
Another scenario examined the risk of locking funds into a year-long investment when the same money was reserved to cover rent due in four months. The mismatch between an investor’s liquidity needs and the maturity of an investment product was highlighted as a common but avoidable error, particularly for Nigerians managing multiple short-term financial obligations alongside long-term wealth goals. Dr Emeka recommended putting the funds in a flexible investment that offers returns of up to 15 per cent, citing the Flex Yield plan on Yield by Credit Direct as a suitable solution.
The session also weighed a scenario comparing two competing offers: a regulated platform offering 18 per cent returns against an individual promising 40 per cent outside any formal regulatory structure. Dr Emeka enlightened the audience by explaining that a regulated investment platform provides fund security if it is licensed or supervised by regulatory bodies like the Central Bank of Nigeria (CBN), giving investors a layer of protection that an unregulated, higher-yielding offer cannot match. He urged attendees to prioritise verifying the regulatory status and credibility of an investment provider over the size of a promised return, a principle that aligns with ongoing efforts by Nigeria’s Securities and Exchange Commission (SEC) to crack down on unlicensed investment schemes operating in the country.
The session encouraged Nigerians not to focus solely on the return being promised when assessing an investment opportunity. A high promised return may appear attractive, but investors need to look beyond the headline figure and understand the opportunity, the risks involved and the credibility of the person or organisation offering it. The discussion highlighted the importance of asking questions before committing funds, rather than allowing the prospect of quick or substantial gains to drive the investment decision.
The session comes as Nigeria’s retail investment sector continues to expand, with digital platforms competing for a growing pool of investors seeking alternatives amid persistent inflationary pressure. The investment exercise ultimately encouraged participants to approach financial opportunities with greater scrutiny and to recognise that the promise of a high return should not replace due diligence. For Nigerians looking to take a deliberate approach to growing their money, Yield by Credit Direct offers a range of investment options tailored to different financial goals and timelines. To learn more about Yield and explore its investment options, visit https://www.creditdirect.ng/yield
About Yield by Credit Direct
Yield by Credit Direct is a fund management platform that offers fixed and flexible ways to grow funds. It is available on the Credit Direct App and web platform at https://www.creditdirect.ng/yield
Credit Direct is building Africa’s leading embedded finance business by integrating credit into the supply chains and payment flows of partners, unlocking financial success for individuals and businesses. The company also provides retail investment solutions, expanding its role from access to credit to broader financial growth and wealth-building. Credit Direct has served millions of customers nationwide, including those historically underserved by traditional banking. Credit Direct is a wholly owned subsidiary of First City Monument Bank (FCMB) Group Plc.
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