The Nigeria Data Protection Commission (NDPC) is currently investigating over 400 cases of privacy breaches involving digital lenders (loan apps), local reports indicate.
In addition, the data protection authority is seeking a ban or restriction on mobile numbers found to have been used by lenders to breach the privacy of their customers.
In its recently released Annual Report for 2023, the Commission highlighted that its ongoing investigations have uncovered that ‘loan apps are excessively intrusive.’ This observation aligns with the long-standing issue, as evidenced by the numerous complaints lodged by users of loan apps over the years.
“They generally violate the principles of Data Protection and Privacy because they have access to contacts, pictures, messages, etc. of data subjects,” the Commission stated.
The Commission has drafted the Nigeria Data Protection Act – General Application and Implementation Directive (NDPA-GAID) which addresses the abetment of data breaches, the need for data ethics and privacy by design and by default among others.
“Under abetment, the third-party platforms through which data privacy breaches take place will now be required to deny access to those who use their platforms for privacy breaches,” the report said.
“Organizations, particularly communication networks, should be willing to restrict or ban telephone lines that are implicated in privacy violations,” it said.
The NDPC further stated that it is collaborating with regulators as part of the Joint Enforcement and Regulatory Taskforce to enhance oversight in the digital lending sector. It highlighted that the Federal Competition and Consumer Protection Commission (FCCPC) now mandates lending companies to obtain data protection clearance from the NDPC before commencing operations.
As reported by BitKE, in November 2023, FCCPC, registered and approved 211 loan apps at the end of October 2023 under the Limited Interim Regulatory/Registration Framework and Guidelines for Digital Lending, 2022.
REGULATION | Nigeria Registers and Approves 211 Loan Apps and Delists 45 from the Google Play Store
The necessity for registration of loan apps, including the 211 approved by the Federal Competition and Consumer Protection Commission (FCCPC), is driven by concerns about the… pic.twitter.com/xkR7Yg8cWE
— BitKE (@BitcoinKE) November 17, 2023
While not all apps in operation are registered under the guidelines, the FCCPC is still receiving complaints from the public. Earlier in 2024, the FCCPC received complaints that these lenders are employing ;crude, unprofessional, and illegal means’ to collect debts, including defamation, cyberbullying, and even death threats.
The complaints reportedly came from Citizens’ Gavel, a consumer rights organization, urging immediate action against 30 unlicensed digital money lenders operating in Nigeria.
