Nigeria’s digital lending sector has received a warning from financial expert Kalu Aja, who urges mobile‑money operators and digital lenders to exercise caution when extending credit. In a recent statement, Aja stressed the need to comply with the “ability‑to‑pay” requirement set out in the Central Bank of Nigeria’s Consumer Protection Regulations. He explained that all loan apps must assess a borrower’s capacity to repay before offering credit, and that lenders should refrain from granting loans to borrowers who cannot meet repayment obligations.
Aja’s remarks come as the Federal Consumer Protection Commission (FCPC) has introduced new regulations to address complaints about digital money lenders and mobile‑money operators. The rules aim to enhance transparency and fairness in the industry, with non‑compliance attracting sanctions such as fines up to N100 million or 1 percent of turnover, and possible disqualification of directors for up to five years. These measures are intended to protect consumers from predatory lending practices.
The introduction of the FCPC regulations marks a significant step toward regulating Nigeria’s rapidly expanding digital lending market. Previously, weak oversight led to numerous grievances over unfair lending, prompting the need for stricter intervention. Under the new framework, digital lenders and mobile‑money operators must operate within tighter controls, prioritising consumer protection and responsible lending.
As the sector continues to evolve, responsible lending is expected to remain a central focus. The FCPC’s regulations are poised to foster a more sustainable, consumer‑centric approach to digital lending, allowing the industry to grow while minimizing the risks associated with predatory practices.
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