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UGO AMADI
On Wednesday, November 16, 2022, Google Play announced updates to its Developer Program Policy, which are expected to come into force from January 31, 2023.
According to these updates, digital money lenders in Nigeria must conform to rules established by the Federal Competition and Consumer Protection Commission (FCCPC). Additionally, they will be required to provide Google Play with other information that proves their compliance with the appropriate regulatory authorities in the country.
In Kenya, digital credit providers will be required to complete the personal loan app declaration for Kenya and obtain a licence from the Central Bank of Kenya (CBK). Apps not directly involved with money lending will also be required to make that obvious while including their partners’ licences.
In August 2022, Nigeria’s FCCPC released the Limited Interim Regulatory/Registration Framework and Guidelines for Digital Lending to curtail predatory lending practices in the country. In addition to filling out a digital lending guidelines form, digital lenders in the country are expected to furnish the FCCPC with the following documents:
In the past few years, personal loan apps have become increasingly common as traditional financial institutions baulked at providing lending services for most Africans.
In Nigeria, less than five percent of the adult population has access to credit facilities, with businesses also affected. Women are the worst hit, as only two percent of Nigerian women have access to credit.
This gap has resulted in personal loan apps stepping into the arena by providing loans at sky-high interest rates and often using predatory tactics to recover loans from customers.
In August 2021, the National Information Technology Development Agency (NITDA) hit Sokoloan with a ₦10 million ($22,635) fine for privacy invasion. This came as widespread reports emerged of the company’s predatory lending activities.
Later, in November 2021, the Agency would partner with the FCCPC, the Economic and Financial Crimes Commission (EFCC), the Central Bank of Nigeria (CBN), the National Human Rights Commission (NHRC), and the Independent Corrupt Practices and Other Related Offences Commission (ICPC) to fight data privacy abuse in the country’s digital lending space.
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