Home Business Banking & Finance FG authorises 173 loan apps, bans illicit internet banks

FG authorises 173 loan apps, bans illicit internet banks

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One hundred and seventy-three applications for digital loans to operate in the nation have been granted approval by the Federal Competition and Consumer Protection Commission (FCCPC).

Fifty-four of the 173 have provisional permissions, while 119 have full approvals. The FCCPC launched a registration effort to defend individuals from the abuses of these applications when loan apps began bothering Nigerians.

The commission released a ‘Limited Interim Regulatory/ Registration Framework and Guidelines for Digital Lending 2022’ to regulate the digital lending space and make registration and approval a prerequisite for companies seeking to operate in the space.

After shifting its deadline multiple times, it finally adopted 27th March 2023 as the close of registration. The commission has now released a list of approved apps that can operate in the country. Companies without approvals will not be able to operate in the space.

On its effort against digital lending apps in August 2022, the FCCPC said: “In addition to the enforcement action(s) and in furtherance of the desire to promote fair, transparent and mutually beneficial alternative lending opportunities apart from traditional lending to consumers, the inter-agency Joint Regulatory and Enforcement Task Force has developed and mutually adopted a Limited Interim Regulatory/ Registration Framework and Guidelines for Digital Lending, 2022 as the first and interim step to establishing a clear regulatory framework.

“This becomes enforceable immediately. It requires permission to proceed in digital lending; it provides a limited moratorium period for existing businesses to comply in order to continue in digital lending.

“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.”

Some of the approved loan apps listed by the commission included Branch International Financial Services Limited, Fairmoney Micro Finance Bank, Pivo Technology Limited, Renmoney Microfinance Bank Limited, Carbon Microfinance Bank Limited and Creditwave Finance Limited.

Loans without the FCCPC’s approval will be removed from Play Store by Google and unavailable for download.

In November, Google Play announced updates to its Developer Program Policy, which mandated that digital money lenders in Nigeria, India, Indonesia, the Philippines, and Kenya must conform to regulatory rules.

This was expected to come into force from 31st January 2023. In March, Google took down hundreds of unapproved loan apps from the Play Store in Kenya according to a report on TechCrunch.

In February 2023, the Nigeria Data Protection Bureau revealed that a national committee, made up of federal agencies, was working in tandem to clip the activities of illegal loan apps in the country.

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