As of May 2025, the number of companies officially registered to offer digital lending services via mobile apps in Nigeria has soared to 425, a significant increase from 320 recorded in 2024.
These companies have either received approval from the Federal Competition and Consumer Protection Commission (FCCPC) or hold operational licenses from the Central Bank of Nigeria (CBN).
Breakdown of Licensed Lenders:
362 companies have secured full approval from the FCCPC.
42 are operating with conditional approval.
21 are CBN-licensed digital lenders.
Rising Indebtedness & Regulatory Challenges
While this growth reflects a booming digital lending market, it also raises concerns over increasing borrower indebtedness. Many consumers now cycle through multiple loan apps, accumulating debts without repayment.
Industry insiders attribute this trend to:
Ineffective credit bureaus, which fail to track borrowers’ credit histories adequately.
Unrestrained competition, driving some lenders to bypass due diligence and issue loans recklessly.
The Ex-Bankers Behind the Boom
Mr. Gbemi Adelekan, Chairman of the Money Lenders Association, highlights that a large number of retired bankers are venturing into digital lending to stay active in Nigeria’s financial ecosystem. The low entry barriers and high demand for quick credit make the sector an attractive business opportunity.
The Menace of Unregistered Lenders
Despite the FCCPC’s regulatory efforts, hundreds of unregistered loan apps continue to operate, exploiting vulnerable borrowers. These unlicensed players are notorious for unethical practices such as defamation and harassment through borrowers’ personal contacts.
In response, the FCCPC has:
Placed 88 loan apps on a watchlist.
Delisted 47 apps from the Google Play Store for violating consumer protection regulations.
Regulatory Efforts to Sanitize the Sector
Dr. Adamu Abdulahi, FCCPC’s Executive Commissioner of Operations, emphasized that the primary goal of the registration process is to identify and hold digital lenders accountable for any misconduct. Before these regulations, tracing the owners of loan apps was nearly impossible.
He added that the FCCPC is working to strike a delicate balance between supporting the growth of digital lending and addressing the rising issue of loan defaults. Despite the sector’s challenges, digital lenders continue to play a vital role in driving financial inclusion and access to credit in Nigeria.
Credit: Nairametrics
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