FG has ordered Flutterwave, Opay, Paystack and Monify and Telcos to block online lenders operating illegally.
The Federal Competition and Consumers Protection Commission, FCCPC, has directed payment systems operators, PSOs, such as Flutterwave, Opay, Paystack and Monify, as well as telecommunication companies and Mobile Network Operators, MNOs, to block online lending services operating illegally in Nigeria.
FG ordered them to stop providing support services for the loan sharks to operate.
Executive Vice Chairman/Chief Executive Officer, FCCPC, Babatunde Irukera, revealed this in a chat with journalists during the Commission’s enforcement drive against the loan sharks.
He said a notorious loan shark, Soko Loan, is the top offender on its investigation against loan sharks.
Note that the commission is going after the loan sharks for operating illegally in the country, using unethical means to regain small loans they lend to people as well as breaking privacy rights of customers.
On March 11, FG conducted a raid through its joint committee investigating rights violations and unfair practices and shut down many illegal online loan sharks for operating illegally and without Corporate Affairs Commission (CAC).
The operations of the loan sharks also violated the rights of Nigerian consumers.
Some of them included GoCash, Okash, EasyCredit, Kashkash, Speedy Choice and Easy Moni.
However, despite the enforcement exercises, the loan shark are still harassing and violating customers and their rights.
Meanwhile, Irukera also said that the commission has developed a Limited Interim Regulatory/Registration Framework and Guidelines for Digital Lending.
The FCCPC CEO said thus:
“The information available to the commission demonstrates that Soko Lending appears to be the most consequential digital money lender with multiple apps and brand names.
“It is covering a significant share of the digital or online lending market, and one of the most prolific actors in violating consumer privacy, fair lending terms and ethical loan repayment/recovery practices.
“Prior to this operation, the commission had previously, on March 11, 2022 carried out a similar enforcement action with respect to multiple lenders; which action and continuing investigation has reduced previously high and escalating unethical, obnoxious and unscrupulously exploitative practices in the industry.’’
Irukera also noted that the online lona sharks have devised other means such as having multiple app, changing brand names and delving into other illegal financial services to keep defrauding people.
“With the operations today, the commission expects appreciable additional reduction in these unacceptable practices.
“The commission has also today entered further Orders that will disable or diminish violators’ ability to devise circumvention efforts or alternative mechanisms to circumvent the objective of the investigation and protection of citizens.’’
The CEO, however, said tech platforms as well as telcos must obtain permission before providing services to online lenders.
“The guidelines also mandate different service providers in the relevant ecosystem such as banks, access/download platforms or stores, technology providers and payment systems to require regulatory approval before providing services.
“The commission expresses its gratitude to victims and citizens who have provided information or contributed to the investigation; and welcomes the continuing engagement that provides the relevant information or intelligence through the already established and publicised channels.’’
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