Nigeria’s competition regulator has begun phased enforcement actions against digital money lending operators that failed to regularise their businesses under newly introduced lending regulations, marking a significant shift in oversight of the country’s fast-growing online credit market.
The Federal Competition and Consumer Protection Commission said the compliance window for digital lenders operating under the Digital, Electronic, Online and Non-Traditional Consumer Lending Regulations, 2025, officially closed on January 5, 2026. Operators that did not meet the requirements are now facing regulatory sanctions aimed at restoring confidence and discipline in the sector.
According to the commission, the enforcement process is designed to bring certainty to the digital lending space while protecting consumers and legitimate businesses from abusive and unfair practices. The regulator noted that the new phase gives full effect to the regulations and signals the end of transitional leniency for non-compliant operators.
The commission explained that conditional approvals previously granted to some digital lenders have been withdrawn where operators failed to complete the required regularisation process. These lenders have also been removed from the commission’s official register of approved digital lenders, which serves as a key reference point for consumers seeking compliant loan providers.
The regulator cautioned Nigerians to be careful when dealing with digital lenders that do not appear on the current register, stressing that inclusion on the list indicates that an operator has met the minimum regulatory standards at the time of publication. The commission said the register is an important consumer protection tool, particularly for small business owners and informal traders who increasingly rely on digital loans to support cash flow and working capital needs.
As part of its enforcement strategy, the commission has also begun structured engagement with application hosting platforms and payment service providers. These engagements form part of broader compliance monitoring efforts and could lead to further regulatory action in line with existing laws and procedures.
For digital lenders that were provisionally recognised under transitional arrangements, the commission has set April 2026 as the final deadline to complete registration under the new regulations. Operators that fail to regularise their status by then may face additional sanctions, including removal from digital platforms and further regulatory scrutiny.
The commission said the enforcement exercise is intended to promote transparency, fair competition, and consumer confidence, while shielding compliant operators from unfair competition. It stressed that effective regulation depends on consistent application and that businesses that follow the rules deserve a predictable operating environment.
Nigeria’s digital lending industry has expanded rapidly in recent years, driven by growing smartphone use, wider internet access and limited availability of formal bank credit, especially for micro, small and medium-sized enterprises. Many small businesses depend on short-term digital loans to manage inventory, payroll and day-to-day expenses.
However, the sector has also attracted widespread criticism over excessive interest rates, unclear loan terms, aggressive debt recovery tactics, data privacy breaches and unauthorised access to borrowers’ contacts. Complaints from consumers and business owners have raised concerns about the sustainability and ethics of some digital lending practices.
These issues led the commission to introduce tighter oversight through the DEON Regulations, which require digital lenders to register with the regulator, disclose ownership structures, comply with data protection rules and follow fair lending and debt recovery standards. In previous enforcement actions, the commission ordered the removal of several loan applications from app stores and sanctioned operators found to have engaged in harassment, public shaming and other unlawful practices.
With the latest enforcement phase now underway, the commission reiterated its commitment to transparent regulation, fair competition and strong consumer protection across Nigeria’s digital economy, warning that operators who continue to flout the rules will face sustained regulatory action.
