Following the Federal Competition and Consumer Protection Commission’s (FCCPC) new regulations on loan app registration and the enforcement of a ₦100 million fine for non-compliance, the number of legally operating digital lending companies in Nigeria has risen to 492.
The new regulation, which took effect on July 21, 2025, under the Digital, Electronic, Online, or Non-Traditional Consumer Lending Regulations, mandates all digital lenders to register with the Commission within 90 days of starting operations.
Non-compliant companies risk fines of up to ₦100 million or 19% of turnover. The FCCPC also warned that directors of defaulting firms could be disqualified from company positions for up to five years.
The increase in registered companies indicates that operators are adapting to the more stringent regulatory landscape. The FCCPC reports that the number of registered lenders has risen to 492, up from 425 in May, with 67 new companies registering in approximately four months to avoid penalties.
Of the 492 companies, 434 have full approval, and 36 have conditional approval pending the completion of requirements. An additional 22 companies, licensed by the Central Bank of Nigeria (CBN), are exempt from FCCPC registration, though the Commission monitors their operations for consumer protection compliance.
FCCPC’s Executive Vice Chairman, Tunji Bello, stated that the move to regulate digital lending was necessary to address prevalent unethical practices. He cited numerous borrower complaints regarding harassment, data breaches, and unfair treatment by unregulated lenders.
Bello affirmed that the new regulation balances innovation with consumer protection, curbing abuse while fostering responsible growth in digital finance.
The FCCPC had previously warned and raided illegal loan apps accused of sending defamatory messages, threatening borrowers’ contacts, and misusing personal data, prompting public criticism and calls for stricter oversight.
New Regulation Sets Clear Standards for Digital Lending
The Digital Lending Regulations, 2025, provide a full legal framework for registering, monitoring, and disciplining all digital and non-traditional lending companies in Nigeria.
The law applies to all unsecured consumer lending carried out through mobile, online, or electronic platforms. It sets out detailed rules covering registration, transparency, data protection, loan recovery, and ethical advertising.
Key Provisions of the Digital Lending Regulations:
- •All digital lenders must be registered and approved before starting operations.
- •Loan apps are banned from accessing customers’ contact lists, photos, and personal transactions.
- •Lenders must clearly display loan terms, including interest rates, repayment dates, and any fees.
- •Unethical debt recovery practices, including harassment or defamation, are strictly prohibited.
- •At least one local partner must be involved in airtime or data-based lending services.
- •Lender partnerships must register jointly, and monopoly-based agreements cannot operate without approval from the FCCPC.
These measures are intended to bring structure and fairness to a sector that had been largely unregulated for years.
The President of the Money Lenders Association, Gbemi Adelekan, hailed the new regulations as a necessary step to clean up the industry. He stated that the rules would promote the use of credit bureaus for debt recovery and prevent harassment and public shaming. Adelekan added that clearer terms and registration standards would also improve borrowers’ understanding of loan conditions.
He also noted that digital lending’s accessibility, compared to the more complex licensing of microfinance banking, attracts new entrants. He added that its flexibility has drawn many former bankers and business owners, even amidst tightening regulations.
FCCPC Pushes Towards a Safer Lending Ecosystem
Building on the 2022 Limited Interim Regulatory and Registration Framework, which initially mandated loan app registration, the latest framework aims to further curb malpractice, as data abuse and privacy violations remained widespread despite the initial effort.
Over the past two years, the FCCPC has collaborated with Google, the CBN, and other agencies to remove unregistered or non-compliant apps from app stores. While some were permanently delisted, others were reinstated upon meeting registration and data protection standards. The new regulations are expected to result in more coordinated and rigorous enforcement.
The commission has placed 103 companies, including lenders suspected of unregistered operation or unethical recovery methods, on its regulatory watchlist for possible sanctions. The FCCPC will continue auditing digital lenders, verifying registered operators, and imposing fines as needed.
Digital lending is a crucial credit source for many Nigerians, particularly those excluded from traditional banking. To address past abuses stemming from rapid industry growth, a ₦100 million penalty now deters unregistered operators and enforces compliance.