Exploitation of Nigerians by online loan lenders worries FCCPC
The Federal Competition and Consumer Protection Commission (FCCPC) on Friday condemned the exploitation of Nigerians by unlicensed online money lenders in the country.
The Executive Vice Chairman and Chief Executive Officer (CEO) of the commission, Mr Babtunde Irukera, spoke at an enforcement exercise on a money lender company in Lagos.
He said that most of the lenders were not registered with the Corporate Affairs Commission (CAC).
FCCPC CEO led a team of operatives and men of the Nigeria Police Force to carry out the enforcement exercise.
The commission considered the activities of the company where the enforcement was carried out as being against the rights of Nigerian consumers.
The company, with a workforce of over 2,000 has several loan apps — Soko Loan, Fast Loan, Ocash, Cash Cash, among others.
Irukera said that the commission got information about the online money lenders during the COVID-19 lockdown in 2020, which led to many of them coming into existence.
“More so, because people were on lockdown due to the pandemic, people started needing small easy loans, which is understandable.
“However, over a period of time, people started complaining about the malpractice of the lenders. So, we started tracking it,” he said.
According to him, at the end of 2021, after gathering a lot of information, the commission started working with some other key agencies to look into the operations of the loan companies.
He said the key agencies which include EFCC, ICPC, National Human Rights Commission, CBN, NCC and FCCPC had an agreement that there would be a joint effort to look into the money lending businesses.
Irukera said: “The key two things that were subjects of concern were what seems to be naming and shaming, violation of people’s privacy with respect to how these lenders recover the loans.
“Secondly, the interest rate seems to be a violation of the ethics on how lending is done. So, those were the two things that we set out to look for.
“We started an investigation trying to determine the location of these people and that has been a very difficult thing.
“We did that for several months and so one of them has moved from one place to the other and we have been visiting this place for months.”
Irukera said the commission found out that most of the companies operate from the same place and actually by the same person.
He noted that such unlicensed online money lenders in Nigeria do not have addresses in the country.
According to him, they are not registered in Nigeria with the CAC and do not have any license to do their businesses.
Irukera said that what they essentially had was an App, and that led the commission to gather and engage people who had been their victims for more information.
The FCCPC boss said as the commission got more information, it had enough to present to the court to convince it to issue a warrant, to pave way for an investigation that could lead to a search and seizure.
“Sometime last month, a court issued a warrant, and between then and now, we were preparing a sting operation which is what you are seeing here today.
“This is because we want to be sure we are hitting at the place we could get many of them,” he said.
Irukera said that in addition to the sting operation carried out, the FCCPC had also issued multiple orders.
He noted that vendors, App Stores and Google Stores where some of the apps were available would be shut down so that people would not be victims anymore.
The FCCPC boss said the commission had made efforts to freeze some of the accounts being used by the managers of the online money lenders.
“I must add that though not all money lenders are operating illegally, and that is why it has been taking time for us to track these people, it doesn’t mean that the people we are proceeding against today are the only ones.
“No, we want to start with them. We also understand that they are between five to seven companies operating at the same location,” he said.