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The Federal Competition and Consumer Protection Commission (FCCPC) has officially registered ten new companies to operate as digital money lenders in Nigeria. With these recent approvals, the total count of registered loan app companies in Nigeria has risen to 211, consisting of 172 with full approval and 39 with conditional approval. This surge indicates a growing interest among companies seeking FCCPC’s endorsement for digital lending services, despite the sector facing reputational challenges related to borrower harassment and defamation.
In comparison to September of this year, when 161 companies had full approval and 40 had conditional approval, the recent increase underscores the influx of new entrants pursuing FCCPC’s authorization for digital lending operations. The FCCPC resumed the registration of digital money lending apps after the March 27, 2023 deadline, contributing to the expansion of the market.
Furthermore, the FCCPC has intensified its scrutiny of the digital lending landscape, with the number of loan apps on its watchlist escalating from 55 in September to 84 by October. Apps on this watchlist are suspected of engaging in unethical practices. Collaborating with Google, the FCCPC has also removed 45 loan apps from the Google Play Store due to illegal operations in the country.
This updated list of approved loan apps follows the registration initiative initiated by the FCCPC last year. The Commission, in partnership with the Joint Task Force (JTF), introduced the Limited Interim Regulatory/Registration Framework and Guidelines for Digital Lending in 2022. This initiative aims to foster fair, transparent, and beneficial alternative lending opportunities for Nigerians, responding to the need for regulation prompted by concerning activities, rights violations, and unfair practices associated with loan apps in the country. Some of these apps have been accused of charging interest rates that breach ethical lending standards and engaging in naming and shaming practices, violating individuals’ privacy during the loan recovery process.
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