E-Financial
Google Tightens Rules on Loan Apps, Operators Cry Out
Google, the global search engine, which provides the digital infrastructure, has tightened regulations on Fintech Loan apps by cutting off access to sensitive data including users’ contacts, photos and location.
Fintech Loan apps are waxing worriedly with Mr. Ngozi Dozie, a major player in the sector, and co-founder of Carbon Micro Finance, frowning at the new rule, describing it as discriminatory, according to HallmarkNews.com
“Why the different treatments? The distinction between lending apps and digital banking apps is disingenuous; a bank, which Carbon is, by default lends. Therefore, all banking apps are by default lending apps, broadly speaking”, he told another medium.
The new regulation is in response to grievances from loan app users, who claimed devious lenders are using the content of borrowers’ smartphones for harassment, defamation and blackmail.
According to the statement released by Google, the new regulation, which will be effective from May 31st, 2023 is purposed to address issues relating to misuse of personal data by loan apps.
“Apps that provide personal loans, or have the primary purpose of facilitating access to personal loans (i.e., lead generators or facilitators), are prohibited from accessing sensitive data, such as photos and contacts. This policy applies to apps, which offer loans directly, lead generators, and those, who connect consumers with third-party lenders,” it stated.
Google, in its April 2023 policy updates mandated Digital money lenders to comply with the regulatory guidelines for digital lending, which according to the company, may be amended from time to time.
“To operate as a Personal Loan App in Nigeria, it is mandatory for Digital Money Lenders (DML) to comply with the Limited Interim Regulatory/Registration Framework and Guidelines for Digital Lending, 2022 (as may be amended from time to time) set by the Federal Competition and Consumer Protection Commission (FCCPC) of Nigeria.
“DMLs must also furnish verifiable approval letters obtained from the FCCPC. Loan Aggregators, on the other hand, are required to provide certification and documentation for their digital lending services, as well as contact information for every partnered DML.
“Additionally, upon request by Google Play, you must submit any supplementary information or documents to demonstrate your compliance with the regulatory and licensing requirements that are applicable to your operations,” Google authorized.
Prior to the policy update by Google, the FCCPC announced that 173 loan apps in Nigeria had been registered, out of these 173 only 119 have received full approvals and are fully licensed while 54 digital loan apps have conditional approvals. The registration is an outcome of its regulatory framework titled the “Limited Interim Regulatory/Registration Framework and Guidelines for Digital Lending 2022, which was released in August 2022 as a measure to curb the excesses of predatory digital lenders.
The commission gave digital money lenders a 90-day ultimatum to register for approval, which was later extended to January 31st, 2023.
According to Babatunde Irukera, chief executive officer of the FCCPC, the incessant infringement of people’s privacy and unscrupulous recovery practices led to the introduction of an interim registration framework for digital lenders in partnership with the Independent Corrupt Practices and Other Related Offences Commission (ICPC), Central Bank of Nigeria (CBN), Economic and Financial Crimes Commission (EFCC) and the Nigerian Communications Commission (NCC).
“What we did was to develop this framework, where we needed to know the people in the market, we needed to know who they were, what they were doing, the source of their money, what type of interest rates they were charging, and how transparent they were with respect to their customers.
“We also want to restrain what kind of information they are able to pull off people’s phones and what they’re able to do with that information, especially with respect to making contact with people on the contact list, and their loan recovery practices; the kind of language uttered, the times they call, what kind of things they say,” he stated.
“The companies that have been registered now are those, who have provided the transparency and the information that sufficiently establishes these facts. We have also partnered with Google to make sure that only companies that are approved under the framework can get on the Play Store because we recognize that that’s one of the most important ways for them to proliferate and get to their customers,” he added.
However, Irukera clarified that the registration is not a certainty that all the registered loan apps are law abiding but it will drastically reduce violation of Law. To buttress his point, he stated that the commission can effortlessly trace the registered companies and punish them accordingly if they violate the law.
The FCCPC has commended the policy update by Google, stating that it is a positive development of its partnership with google to sanitize the digital lending space as well as to address the invasion of borrowers privacy by loan apps.
On its official twitter page, the commission posted a tweet concerning the new policy which ensured consumer protection.
“FCCPC is transforming the way it works to ensure fair competition & consumer protection. Just did with digital loan apps. Partnered #ICPC, #EFCC, #NITDA, #CBN, #NCC & #NHRC to introduce interim registration framework; & Google to ban loan apps from accessing user contacts, photos”
Irukera, the CEO of FCCPC reacted to this post affirming that the battle won calls for celebration.
“One more battle won in a large war to protect the rights of consumers. We focus on the raging war, but celebrate the small wins too. We started out to confront this monster, & now Nigeria has led again with demonstrating desire and will to protect her own. One battle at a time!” he tweeted.
Reactions to this tweet by “@fccpcnigeria” signified that the new policy was a huge relief for loan app users, who have been victims of unethical recovery practices, harassment and blackmail from loan apps.
Tolu Ogunlesi, the Special assistant to President. Muhammadu Buhari on Digital & New Media in his response to the post stated that “Privacy violations have been a problem with loan apps in Nigeria for a while now, e.g. illegally accessing user contact lists and photos. @fccpcnigeria working to ensure that it no longer happens.”
Moyosore Lukmon Oloyede, a twitter user, who responded to this post commended the estimable efforts of the FCCPC.
“Data protection is a big deal. Government need to protect the people more with policies that will control unnecessary access to public data. Kudos to @fccpcnigeria for this laudable collaboration and commitment. It’s time to act against SM platforms too like TikTok, FB etc,” he tweeted.
“There is a grave danger that what started as a positive action will stifle innovation and hurt the smaller companies that are doing God’s work in financial inclusion. What’s worse is that there is already an uneven playing field between the fintech Davids and the Big Bank Goliaths.”
Abuse of access by loan apps
“Certainly in some emerging markets including Nigeria, I suspect the abuse of this data by many lending apps acted as a main driver. It works like this:
“Customer downloads lending app to borrow money; a precondition for the loan is providing access to their contacts and photos. If the customer defaults on a loan then to shame the customer to repay, the lender sends some or all the contacts of the borrower message.
“Clearly, this practice is abusive and goes against all privacy laws; Google is right to reduce the invasion of privacy. But in implementing this policy with not enough nuance, Google is cutting the legs off from some of the more innovative companies that are doing the Lord’s work, like Carbon,” he said.
The updated Google policy will be instrumental in protecting users from fintech loan apps who capitalise on the desperation of borrowers by giving out loans at outrageous interest rates. When these borrowers default, they resort to threatening them and sending defamatory messages to their contact list. The collaborative efforts of FCCPC, Google and other agencies will undoubtedly sanitize the Digital money lending industry in Nigeria.
OneWallet microfinance Bank is partnering Zenith bank and MTN to build a platform that will provide digital financial services to support the growth of Small and Medium Scale Enterprises (SMEs) businesses in Abia State.
Dr. C Darl Uzu, Chairman of OneWallet, who disclosed this while launching the platform for traders at the Ariaria International Market, Aba, Abia State said it was meant majorly for traders and the SMEs because they are the bedrock of the Nigerian economy.
According to Dr. Uzu, “We want to expand the inclusion of small businesses in digital financial services by making it easy for them to make and receive payments on affordable digital devices, hence the UnionBell Smart phones and POS.
“We want to help SMEs to access financial support and loan easily to grow their business, and also help businesses to build the history and credibility they require for future growth and expansion.”
He said OneWallet was not created just as a payment application, but as a business support platform designed around the real needs of SMEs.
Dr. Uzu said the choice of Ariaria International Market as the pilot for the platform was intentional since the market is one of the strongest symbol of enterprise in Nigeria.
“We are not here however to teach Ariaria people how to trade because Ariaria already understands business, but we are hear to support Ariaria business energy with tools that can help businesses do more, reach more customers, organize better and prepare for bigger opportunities; we are here to help Ariaria innovate and grow.”
He thanked MTN, Zenith bank and the leadership of the traders for partnering OneWallet to provide the platform that help businesses to expand.
A representative of MTN at the launch, Dr. Ernest Chieke described OneWallet as a platform for individuals and SMEs which intend to move their businesses forward.
He expressed joy that his firm was partnering OneWallet to bring solution to SMEs’ financial problems.
Carl Akwarandu who represented Zenith bank at the event said the bank decided to partner OneWallet because it has a unique product that will make small businesses grow faster.
He promised that Zenith bank would give OneWallet all the support it needs to make it number one microfinance bank in the country.
The Director of OneWallet, Dr. David Nwosu described the microfinance bank a one stop-touch for SMEs growth.
He said at OneWallet, collateral are not needed to obtain loan, but the individual’s business history.
A member of the board of the microfinance bank, Wiedong Wang, commended Dr. Uzu for establishing OneWallet.
He expressed optimism that with the help of its partners, OneWallet will excel.
Central Bank of Nigeria (CBN) has warned non-interest financial institutions against governance and compliance risks capable of undermining public confidence and financial stability in the country’s growing Islamic finance sector.
Interest-free banks, often known as non-interest or Islamic banks, operate without charging or paying traditional interest (Riba).
The warning was contained in a press statement issued by the apex bank following the 2nd Annual Interactive Session between the CBN Financial Regulation Advisory Council of Experts and the Advisory Committees of Experts of Non-Interest Financial Institutions held at the CBN Auditorium in Abuja.
Speaking through Dr Rita Sike, director of the Financial Policy and Regulation Department, Philip Ikeazor, deputy governor, Financial System Stability, said the rapid expansion of the industry had increased exposure to operational and regulatory vulnerabilities.
The statement read, “The Deputy Governor, however, observed that as the industry grows in size, sophistication, and interconnectedness, it faces unique risks, particularly non-compliance risk, governance challenges, operational vulnerabilities, and emerging technological risks.
“He warned that such risks, if not properly managed, could undermine public confidence, financial stability, and the overall credibility of the non-interest finance ecosystem.”
According to the CBN, the engagement was part of ongoing efforts to strengthen Shariah governance, improve regulatory clarity, and reinforce risk management standards within the non-interest financial services industry.
The apex bank noted that non-interest financial institutions continued to play an increasingly important role in Nigeria’s financial system by providing ethical and Shariah-compliant alternatives to conventional banking.
It stated that the institutions were also contributing to financial inclusion, real sector financing, micro, small, and medium enterprises development, and shared prosperity.
The CBN further explained that the establishment of FRACE and the mandatory constitution of ACEs across all non-interest financial institutions were designed to institutionalise a harmonised governance framework for the sector.
According to the statement, sustained interaction between FRACE and ACEs remained critical to ensuring that regulatory expectations were properly understood and consistently implemented across the industry.
“The objectives of today’s session include fostering the institutionalisation and effective operation of a robust Shariah governance system within Non-Interest Financial Institutions, and providing a structured platform for dialogue, knowledge-sharing, and collaboration,” Ikeazor was quoted in the statement.
In his remarks, Prof Bashir Umar, deputy chairman of FRACE, said the interactive session was aimed at strengthening governance within the non-interest finance sub-sector and promoting constructive engagement between regulators and industry advisory committees.
He also commended the management of the CBN for reviving the session, which was first introduced in 2014.
Earlier in her welcome remarks, Sike reaffirmed the apex bank’s commitment to building a strong and well-governed non-interest financial services industry.
She noted that the growing diversity of products and delivery channels, particularly the emergence of Islamic fintech, had increased the need for stronger regulatory oversight and continuous engagement among industry stakeholders.
“The growing diversity of products, institutions, and delivery channels, particularly with the emergence of Islamic fintech, underscores the need for continuous dialogue, sound regulatory oversight, and robust advisory input from scholars and practitioners,” she said.
The session featured technical presentations on Shariah non-compliance risks in non-interest banks and the role of Islamic fintech in driving financial inclusion.
Participants at the event included members of FRACE, chairmen and members of various ACEs, managing directors of non-interest banks, senior CBN officials, and representatives of the Bank of Industry and the Securities and Exchange Commission.
Federal government is in discussions with the World Bank over a proposed $1.25 billion loan facility aimed at supporting economic reforms, job creation, and competitiveness programmes across Nigeria.
A World Bank document titled Nigeria Actions for Investment and Jobs Acceleration showed the facility has moved beyond the concept and appraisal stages and is now scheduled for a decision meeting ahead of a planned Board presentation on June 26, 2026.
If approved, the loan would become Nigeria’s second-largest World Bank financing package after the $1.5 billion Reforms for Economic Stabilisation to Enable Transformation Development Policy Financing approved in June 2024.
The document listed the Federal Republic of Nigeria as the borrower, while the Federal Ministry of Finance will serve as the implementing agency.
It explained that the project is currently at the decision-meeting stage of the World Bank’s project cycle, where final appraisal documents undergo internal review before submission to the Board of Executive Directors for approval.
At this stage, the institution confirms policy actions, financing terms, and reform commitments already agreed in principle between Nigeria and World Bank teams.
It also said the proposed facility will support government efforts to expand access to finance, digital services, and electricity, while strengthening competitiveness through reforms in taxation, trade, and agriculture.
World Bank says loan will support finance, digital access, and electricity reforms
Between June 2023 and May 2026, the World Bank approved about $9.35 billion in loans and credits for Nigeria across key sectors including power, education, healthcare, agriculture, renewable energy, social protection, and MSME financing.
Major approvals during the period include the $2.25 billion RESET and ARMOR reform financing in June 2024, $1.57 billion for HOPE and SPIN programmes in September 2024, and $1.08 billion for education and resilience projects approved in March 2025.
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