AI agents for business finance: what they can and can't do
What AI agents can do in bookkeeping, close, collections and compliance today, where a person must stay in charge, and how to judge a product.
The short answer
The Credit Reporting Act 2017 lets a lender pull your credit report to decide whether you can act as a guarantor, so that check can be recorded as an enquiry. Whether the guarantee itself is listed on your report depends on what the lender submits to the bureau; the Act does not require it to be shown, and the bureaus' public pages do not say how they display guarantees, so ask the lender and check your own report.
What a guarantee is, in credit terms
When you guarantee a loan, you promise the lender that you will pay if the borrower does not. Nigerian banks often ask for guarantors on salary loans, school fees loans, small business facilities and tenancy arrangements. A guarantee is a contingent liability: it costs you nothing while the borrower pays, and it becomes your debt only if the borrower defaults and the lender calls on you under the guarantee's terms.
That difference matters for credit reporting. A loan you took is a facility in your name. A guarantee is a promise about someone else's facility, and it may or may not be recorded against you.
What the Credit Reporting Act says
The Act mentions guarantors directly in one place. Section 7(2)(a) lists, as a permissible purpose for pulling a credit report, "considering an application for credit by any person or considering a person's qualification to act as a guarantor for any credit". So:
- A lender may check your report before accepting you as guarantor. It needs your consent, which under the Act must be written or given through a verified electronic channel, not oral.
- That check is a request to the bureau. CRC Credit Bureau says its reports show inquiry details (who asked, and when), so the lender's name and the date can appear in the enquiries section of your report.
- The Act does not say a guarantee must be listed as a facility on the guarantor's report. It defines credit information broadly, including "financial obligations", so a lender is allowed to report it if it chooses.
When a guarantee starts to count against you
Think of it in three stages.
| Stage | What may appear on your report | Likely effect |
|---|---|---|
| You agree to guarantee | An enquiry by the lender, if it checked you | Small; an enquiry is not a debt |
| The borrower pays on time | Possibly a guarantee entry, if the lender reports it | Some lenders count it when working out how much more you can carry |
| The borrower defaults and you are called on | The amount you now owe may be reported in your name | A missed payment on that amount counts like any default |
| You pay under the guarantee | The entry shows as settled | Settled history remains but reads far better than an open default |
The serious risk is stage three. Once the lender has demanded payment from you under the guarantee and you do not pay, you are the one in default. Lenders are credit information providers under the Act and may report that without asking you first (section 9(2)(a)).
A worked example of exposure
Example only. Ada guarantees her cousin's ₦600,000 business loan, repayable in 12 monthly instalments of ₦60,000 (₦720,000 in total, including interest). Her cousin pays 7 instalments (₦420,000) and stops. The bank's statement shows ₦180,000 of instalments outstanding (5 × ₦60,000 = ₦300,000 scheduled, less a ₦120,000 part-payment the cousin made). The bank writes to Ada under the guarantee for ₦180,000 plus any charges the guarantee allows. If Ada pays, her exposure ends at what she paid. If she ignores the letter, the bank can pursue her for the amount and may report the unpaid obligation against her BVN-linked record.
Questions to ask before you agree
Most guarantees in Nigeria are signed as a favour to family, colleagues or friends, often in a hurry at the bank. A few questions asked first can save years of trouble:
- How much is the loan, what is the monthly repayment and what is the total repayable? Ask for the lender's offer letter, not the borrower's summary.
- Is my liability capped at a fixed sum, or does it cover the whole debt plus interest and charges?
- Does the guarantee end when this loan is repaid, or does it cover future facilities to the same borrower?
- Will the lender tell me if the borrower misses a payment, or only when it demands payment from me?
- Can I afford the full amount if I have to pay it? If not, consider guaranteeing a smaller sum, or declining.
Steps: protect yourself before and after signing
- Read the guarantee. Note the maximum amount you are liable for, whether interest and charges are included, and whether it ends when the loan is repaid.
- Ask the lender in writing whether it reports guarantees to credit bureaus, and to which ones.
- Keep the borrower's repayment schedule and ask the borrower to share proof of payments.
- Pull your own report once a year, free under section 9(6)(a) of the Act. See how to read it line by line.
- Get a discharge letter when the loan is repaid, and dispute any guarantee entry that stays open afterwards; see how to dispute an error.
Where Pryme fits
Loans on Spaces are lent by Solid Allianze Microfinance Bank to the customer, based on how the customer's own account is run, and the agreement is shown in full before the customer accepts. Solid Allianze, the lender, uses credit bureaus, so a borrower's own repayment history matters; see how Nigerian credit bureaus work.
Questions people ask
Can a bank check my credit report before I stand as guarantor?
Yes. Section 7(2)(a) of the Credit Reporting Act 2017 makes assessing a person as guarantor a permissible purpose, with the guarantor's consent.
If the person I guaranteed defaults, will it affect my credit score?
It can, once the lender calls on you and you do not pay. The unpaid amount is then your obligation, and lenders may report it to bureaus.
Does a guarantee reduce how much I can borrow?
Some lenders count guarantees when they assess how much more you can repay. Ask the lender how it treats them.
How do I remove a guarantee from my credit report?
When the loan you guaranteed is repaid, get a discharge letter from the lender and ask it to update the bureau. If the entry stays open, dispute it in writing with the bureau and the lender.
Sources
- Credit Reporting Act 2017 (certified copy, via PLAC) · accessed Oct 2026
- CRC Credit Bureau: FAQ · accessed Oct 2026
This article is general information, not financial, legal or tax advice. Products described are provided under the terms on this site and are subject to regulation and eligibility.