Some Nigerians don’t even know when a business is running a Ponzi scheme.

I just realize that some Nigerians don’t even know when a business is running a Ponzi scheme.

They believe that once the business is paying them monthly payment due every month, the account manager is checking up on them with a sprinkle of motivational speech and a little dashing of money here and there from the owner, the business is legit.

Let me repeat this for those at the back of the class:

A business is said to be a Ponzi scheme when you give a business your money in lieu of interest payment but you can’t actually pinpoint what they are doing with the money.

Even the business structure they claim they have cannot generate the returns they pay out every month to their investors.

Most importantly, you the investor has not seen before, the financial book of the business you gave your money.

You don’t know whether it is a profitable business or a loss making business but you believe it is legit.

The only thing you know is that the owner is a good man who loves God and you get your alert every month.

It does not work like that ooo.

Let me give a practical example.

If I want to borrow a loan of 100 million naira from Zenith bank for instance.

Zenith bank will give me the loan at 22% interest per annum.

So I’m expected to pay the loan back with 22 million naira Interest rate at the end of one year.

But some of these snake operators who run investment business promise 5% Interest payment monthly.

So let’s say I give them 1 million naira for one year, I will earn 50k every month and at the end of the year I’m expected to earn an accumulated 600k plus my capital making it 1.6 million but if I borrow 1 million from Zenith bank as a business man, I will pay back 22,000 monthly and then pay 260k at the end of one year.

So as a business man who wants to make money and be rich, why would I leave bank that is cheaper for me to access cheap capital and instead lure you on Facebook for you to give me your life savings when it is cheaper to collect the money from bank than paying you 3-5% every month for your life savings?

You check it out, does it make sense to you?

Is this type of business model of robbing Peter to pay Paul, sustainable to you?

In summary. as a business man that has good intentions, It is cheaper for me to use a bank because it is cheaper for my business than promising you monthly 5% which is expensive.

If the intentions of these snake opeators are pure, why not go and meet bank for cheaper capital than paying premium to access the same capital?

I wish you guys still patronizing Ponzi scheme operators all the best but I will be here when the premium tears will flow after the Ponzi scheme business with so much fake promise has crashed.

Then I will remind you that I warmed you but you choose to listen to your greed instead of your brain.