A federal high court in Lagos, Nigeria, has temporarily halted the Federal Competition and Consumer Protection Commission (FCCPC) from enforcing certain provisions of its 2025 digital lending regulations, following a legal challenge from an industry group.
The association, representing companies engaged in digital lending in Nigeria, claims that certain regulatory provisions would negatively impact its members, necessitating a court challenge.
The Digital, Electronic, Online, and Non-Traditional (DEON) Consumer Lending Regulations were officially published and came into effect in July 2025. The FCCPC designed these rules to establish a comprehensive framework ensuring fairness and transparency in digital lending. These regulations cover various aspects, including lender registration, loan recovery practices, customer data management, and clear disclosure of loan terms.
The commission has set January 5, 2026, as the deadline for full compliance.
WASPA Nigeria requested the court to block the FCCPC from enforcing specific parts of its regulations, specifically sections 3, 7, 10, 12, 13, 14, 15, 16, 24, 27, 29, and 32. Additionally, WASPA sought to limit the FCCPC from imposing fines, sanctions, or directives on its members during the legal proceedings.
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After reviewing the arguments presented by the association's lead counsel, Kemi Pinheiro, Judge Lewis-Allagoa found sufficient grounds to provide temporary protection until the court fully hears the case.
The court has currently prohibited the FCCPC from enforcing or taking action on the relevant parts of the disputed regulations until a ruling is made on the main issues. The FCCPC is also barred from preventing WASPA members from continuing operations and cannot penalize them for non-compliance with the challenged regulations. Furthermore, the FCCPC cannot issue any new orders or directives to enforce the disputed regulations.
This case has been adjourned until April 27, when the court will hold a more detailed hearing to decide whether to extend the temporary order into a longer injunction during the litigation.
The FCCPC's regulations aim to address ongoing issues within Nigeria's rapidly growing digital lending industry. These issues include hidden fees, aggressive debt collection practices, and the improper use of borrowers' private information. The upcoming case ruling will determine whether these regulations will be fully enforced.