FCCPC vows to clamp down on defaulting loan apps for non-compliance
The commission noted that despite the laid down regulations, the loan apps have resorted to using unethical means for debt recovery.
According to a statement issued by the commission's acting Executive Vice Chairman/ Chief Executive Officer, Dr. Adamu Abdullahi, the body noted the rise in violations committed by the different loan apps occasioned by the increase in the number of Nigerians who have turned to the loan apps to make ends meet.
Abdullahi in the statement said: “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 the 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.
The commission also noted that despite the laid down regulations, the loan apps have resorted to harassment and intimidation of customers by using unethical means for debt recovery.
Over time, there have been a lingering battle between the FG, consumers and the loan apps concerning the manner the digital lenders go after their customers’ who defaulted over repayment.
The FCCPC in collaboration with key entities like Google, the Independent Corrupt Practices and Other Related Offences Commission (ICPC), the Central Bank of Nigeria (CBN), the Economic and Financial Crimes Commission (EFCC), and the Nigerian Communications Commission (NCC), had established an interim registration framework for digital lenders.
The collaboration successfully led to the removal of dozens of defaulting loan apps that were accused of having illegal access to customers' information like phone contacts and photos which they used to defame the customers. This action reduced the harassment and defamatory messages sent by digital money lenders to their customers by 80% last year.
Speaking further, Abdullahi noted that the body will initiate engagements with the approved loan apps concerning “a more robust compliance framework including any additional requirements where applicable, and possible mechanisms for otherwise blacklisted apps.”
He added that the FCCPC will properly scrutinise the digital lending space and would not hesitate to turn the full weight of the law on operators that do not possess the Commission’s approval.
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