The Federal Competition and Consumer Protection Commission (FCCPC) has officially registered and granted approval to more digital money lenders, commonly referred to as loan apps. This has increased the total number of approved companies to 211 by the end of October.
Among these 211 companies, 172 have received full approval from the Commission, while 39 others have received conditional approval. In contrast, as of September this year, there were 161 companies with full approval and 40 with conditional approvals.
This increase signifies a growing interest in securing FCCPC’s endorsement for digital lending businesses, despite the tarnished reputation of the industry due to instances of harassment and defamation of borrowers by certain lenders.
Furthermore, the resumption of the registration of digital money lending apps by the FCCPC after the March 27, 2023, deadline has opened the door for more companies to enter the market.
Additionally, the number of loan apps under the watchlist of the consumer protection watchdog has risen from 55 in September to 84 at the end of October. These apps are suspected of engaging in unethical practices.
Some of the apps on the watchlist include Cashlawn App, Easynaira App, Crediting App, Yoyi App, Nut Loan App, Cashpal App, Nairaeasy Gist Loan App, Camelloan App, Nairaloan App, Moneytreefinance Made Easy App, Cashme App, Secucash App, Creditbox App, and Cashmama App. Others include Crimson Credit App, Galaxy Credit App, Ease Cash App, Xcredit, Imoney, Naira Naija, Imoneyplus-Instant, Nairanaija-Instant, Nownowmoney, Naija Cash, and Getloan.
In addition to the apps on the watchlist, the FCCPC has, in collaboration with Google, removed a total of 45 loan apps from the Google Play Store. These delisted apps were found to be operating illegally in the country.
The registration of loan apps is part of the FCCPC’s ongoing efforts to address the issues surrounding these services. The Commission introduced the Limited Interim Regulatory/Registration Framework and Guidelines for Digital Lending in 2022, in partnership with the Joint Task Force (JTF). This initiative aims to promote fair, transparent, and beneficial alternative lending opportunities for Nigerians.
The need for this registration arose due to the problematic activities of loan apps in the country, especially illegal ones, which have been accused of violating rights and engaging in unfair practices. Some of these loan apps charge interest rates that violate ethical lending standards and engage in practices like naming and shaming, which infringe on people’s privacy when attempting to recover loans, among other violations.