Nigeria’s multi-trillion-naira digital lending industry — long dominated by a handful of multinational telecom giants and their preferred intermediaries — is at the centre of a regulatory storm, as new government rules threaten to upend the status quo.
At stake is the Digital, Electronic, Online, or Non-Traditional Consumer Lending Regulations 2025, a sweeping reform by the Federal Competition and Consumer Protection Commission (FCCPC) designed to open the market, protect borrowers’ data, and ensure transparent lending practices.
But even before the ink dried on the Federal Gazette, powerful players were already fighting back. A senior source at the Presidency told this newspaper that certain telecom operators have been lobbying regulators and lawmakers to slow or dilute the rules, allegedly offering inducements worth “millions of dollars” in the process.
“These reforms directly affect revenue flows from airtime and data lending, which for some operators run into hundreds of billions annually,” the source said. “The resistance is fierce, and the methods are questionable.”
The NCC’s own data underscores why the stakes are so high. In 2023 alone, telecoms issued 46 billion airtime/data advances valued at ₦1.4 trillion. MTN, the market leader, has disbursed over ₦2.8 trillion in such loans since inception, splitting revenue 75:25 in its favour with its South African-owned partner, Nairatime Holding Limited.
With a flat 15% service fee per transaction and default rates as low as 4.64%, the airtime credit business is a cash machine — one critics say has operated with minimal oversight.
Perhaps, the most controversial provision in the new regulations is Section 24, which requires telcos to work with at least two intermediaries for loan activation within 60 days of commencement — one of which must be wholly Nigerian-owned. For years, Nairatime, for instance, has dominated the activation of MTN’s airtime lending services, locking out local fintechs from participating in the high-margin business.
“The monopoly has stifled innovation, inflated consumer costs, and denied Nigerian companies a fair shot at the market,” said Chika Agu, an academic and renowned economist. “The FCCPC’s move is long overdue. We need a level playing field.”
Civil society coalitions are now pressuring the government to hold firm, warning that any delay in enforcement will entrench foreign control over a critical part of Nigeria’s digital economy.
Beyond competition, the FCCPC reforms are also about fairness and inclusion. For millions of Nigerians, airtime lending is their first and often only experience with credit. Yet most of these transactions are invisible to banks and credit bureaus, meaning borrowers who consistently repay on time gain no formal credit history.
The new rules change that. Under Part 6, lenders must share repayment data with recognised credit bureaus in compliance with the Nigeria Data Protection Act 2023.
Consumer rights advocates say this could help borrowers transition from micro digital loans to larger bank or microfinance facilities, boosting entrepreneurship and household resilience.
“This regulation is not just about curbing exploitation — it’s about recognising the financial behaviour of millions of ordinary Nigerians,” said economist Dr. Ifeoma Okoye. “If you’ve been repaying airtime loans for years, that should count when you apply for a business loan.”
The regulations go further, banning pre-authorised lending without consumer consent, mandating clear disclosure of interest rates and fees, and requiring robust complaint resolution within 48 hours.
They also introduce penalties of up to ₦100 million or 1% of turnover for corporate offenders, with directors personally liable in some cases.
“Consumers have long been at the mercy of opaque contracts and unilateral changes in terms,” noted an insider at the who took part in setting up the regulation.
“That era is ending.”
With the compliance clock already ticking, the months ahead could define the next decade of Nigeria’s digital credit market.
Will regulators hold the line against lobbying? Will local fintechs finally gain a foothold? And will millions of borrowers see their data work for them, not just for corporate profit?
For now, one thing is clear: the days of the telcos’ unchallenged dominance are numbered — if the rules survive the fight.
