Over the past year the Central Bank, the Economic and Financial Crimes Commission and agencies have coordinated raids, arrests platform shutdowns and reforms. By targeting unlicensed digital lenders imposing interest rate caps enforcing data protection rules and banning abusive collection practices these measures dismantle predatory debt traps.

Public education campaigns and consumer hotlines now empower Nigerians to verify genuine credit providers and report violations.

Together these actions create a safer borrowing environment by ensuring access to responsible lending and protecting the wellbeing of citizens.

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• Shutting down unlicensed platforms

Regulators have identified dozens of mobile and web based lending services operating without a valid licence and ordered internet service providers and app stores to remove them.

Enforcement teams seized server equipment and arrested key operators who continued to solicit deposits despite warnings. This immediate removal of illicit apps prevents new borrowers from falling victim and disrupts organised crime networks behind the schemes.

• Imposing transparent fee and interest limits

Official directives now cap the maximum annual interest rate and restrict fees to a single upfront charge for administrative expenses. Lenders must clearly disclose all costs before disbursing funds and publish their rate tables on regulated portals.

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By replacing hidden daily or weekly levies with a simple ceiling structure borrowers can calculate their repayment obligations and avoid spiraling debt traps.

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• Enforcing strict data protection rules

New regulations require loan apps to obtain explicit consent before accessing contacts, photos location and other personal information. Companies must store user data on encrypted servers within Nigeria and undergo regular security audits.

Breaching these standards can result in heavy fines and criminal charges ensuring that borrowers’ private details cannot be harvested or sold to third parties.

• Banning abusive debt collection tactics

Guidelines now prohibit lenders from sending threatening messages, making unsolicited calls or publishing borrowers’ information on social media. Enforcement notices outline clear penalties for harassment including suspension of licences and asset forfeiture.

Victims of unlawful collection practices can lodge complaints with a dedicated hotline and see enforcement officers take swift action against offenders.

• Empowering consumer awareness and redress

Public service announcements on radio television and social media explain how to spot predatory offers and verify legal lenders. A central complaint portal channels grievances directly to the regulators for investigation within 48 hours.

By arming citizens with the knowledge to check licences fee structures and redress mechanisms the government shifts power back to informed borrowers.

• Strengthening legal and supervisory frameworks

Amendments to micro lending guidelines clarify definitions of digital credit and introduce repeat compliance checks for all active operators.

Regulators now conduct unannounced inspections and require quarterly reporting on loan volumes, repayment rates and customer feedback. These measures close loopholes fraudsters exploited and reinforce continuous oversight rather than one off licence issuance.

• Coordinating across financial and telecommunications sectors

Banks, mobile money operators and telecom providers share blacklists of banned loan apps and phone numbers to prevent registration or fund transfers. Payment processors freeze merchant accounts associated with unlicensed lenders and notify regulators of suspicious transaction spikes.

This multi-sector collaboration closes distribution channels and cuts off funding routes for predatory platforms.

These combined actions are helping to build a fairer, more trustworthy digital lending environment where Nigerians can access credit without fear of abuse.

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