FG plans new regulation for Opay, Palmpay, Moniepoint, others

The Nigerian government, via the Federal Competition and Consumer Protection Commission (FCCPC), is set to issue more regulation for digital lending in 2024.

The regulations will improve loan recovery methods in Nigeria amid rising debtor defaults.

FCCPC reduces harassment by loan apps by 80%

Babatunde Irukera, the Chief Executive Officer of FCCPC, disclosed this on a TV programme.

Punch reports that Irukera said while the FCCPC has reduced the incidents of harassment in the industry, there is still a high level of default from Nigerians.

According to him, there is a significant level of loan defaults because people must refrain from using unethical and inappropriate loan recovery mechanisms.

He stated that the loan apps should find other alternatives to loan recovery rather than embarking on harassment and intimidation.

He said: “We must necessarily do the work no matter how hard it is to find a more sensible way to recover loans because I also agree that if these digital money lenders are unable to recover their loans and drop out of the market, it is a consumer protection problem because of those who need those types of short-term unsecured lending.

“So, we have to find the balance, and some of the regulations that will come out in 2024 will be a broader approach to responsible borrowing and lending by individuals and corporations. I am hopeful that the future of what we’re building is that even school landlords can report to a centralized credit system about the conduct of tenants, students, and parents so that we can know each person’s level of fiscal responsibility or credit wordiness.”

The commission offers lessons to other countries

Recently, the commission revealed that it had reduced harassment and defamatory messages in the industry by 80%. Irukera noted in the past that the country is one of many struggling with digital lending.

According to the FCCPC boss, India, Kenya, Brazil, Ghana, and Uganda are still grappling with digital lending, stating that some countries take lessons from the commission.