FCCPC Warns Digital Money Lenders Against Violation of Customers’ Rights

The Federal Competition and Consumer Protection Commission (FCCPC) has again warned digital money lenders against the violation of customers’ rights and the deployment of unethical recovery methods against their debtors.

In a statement yesterday, signed by the acting Executive Vice Chairman/ Chief Executive Officer, Dr. Adamu Abdullahi, the commission stated that its bid to protect customers was pursuant to sections 17(a), (e), (g), (h). (1, (m), (s), (x), (v), 18(3), 123, 124, 127, 129 and 130 of the Federal Competition and Consumer Protection Act, 2018 (FCCPA).

The commission said that as part of the continuing investigation and monitoring of Digital Money Lenders (DMLs), it had observed an upsurge in violations of the Inter agency Joint Task Force’s Limited Interim Regulatory/Registration Framework and Guidelines for Digital Lending, 2022.

“The commission understands the increased demand for loans during this time of year, leading to an increased risk of default due to large numbers and typical cash flow challenges and constraints.

“However, the solution cannot be to violate law or utilise unethical recovery methods. As such, the commission is intensifying enforcement efforts and adopting a zero-tolerance stance towards any exploitation of consumers or abusive conduct, whether in balance calculations, loan default enforcement, or recovery processes,” it stated.

In addition, in the coming days, the commission said it will be engaging approved loan apps with respect to a more robust compliance framework, including any additional requirements where applicable, and possible mechanisms for otherwise blacklisted apps.

The commission noted that it will welcome demonstrated and timely compliance by all legitimate operators in order to promote and enhance fairness to consumers and fairness among competitors.

With respect to operators that do not possess the commission’s approval, the scrutiny process, it said, will include law enforcement action against such, in addition to regulatory prohibition and consequences.

“The commission reiterates its commitment to ensure legal and ethical operations in digital lending; and encourages consumers to consider/patronise only approved DMLs (list available at Error! Hyperlink reference not valid.,” it added.