Nigeria unveils strict regulations to tackle rogue digital lenders

The Federal Competition and Consumer Protection Commission (FCCPC) has introduced sweeping new regulations to curb unethical practices among digital lenders in Nigeria’s fast-growing online credit market.

The rules, issued pursuant to Sections 17, 18, and 163 of the FCCPC Act (2018), take effect from July 21, 2025, and aim to address widespread complaints of harassment, privacy breaches, exploitative lending, and anti-competitive conduct.

According to the Commission, the framework establishes mandatory standards on transparency, fairness, data protection, ethical recovery methods, and responsible lending. All providers of unsecured consumer loans through digital, mobile, or non-traditional platforms are now required to register with the FCCPC within 90 days of commencement.

Announcing the commencement of the regulations in Abuja, the Commission’s Executive Vice Chairman/CEO, Tunji Bello, said Nigerians had suffered long enough from harassment and unethical practices by unregulated digital lenders.

“These regulations draw a clear line that innovation is welcome, but not at the expense of consumers’ rights and dignity, or the rule of law,” Bello stated.

“No consumer should be harassed, defamed, or lured into unsustainable debt under the guise of digital lending.”

The provisions include a ban on pre-authorised lending and unethical marketing tactics, compulsory joint registration for partnerships, and requirements for transparent loan terms. They also mandate local ownership of at least one service provider in airtime and data lending and prohibit dominance-based agreements without FCCPC approval.

Defaulters risk penalties of up to ₦100 million or 1% of their annual turnover, as well as director disqualification for up to five years.

The FCCPC urged lenders to visit its website for registration guidelines and encouraged consumers to report illegal or abusive lending practices through its dedicated complaint portal at lenderstaskforce@fccpc.gov.ng.