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Strengthening Nigeria’s Digital Money Lending Ecosystem

Author

Listed:
  • O. Monye

    (University of Benin
    University of Cape Town)

Abstract

The article examines the proliferation of short-term, unsecured credit offered by digital money lenders (DMLs) in Nigeria, with a focus on abusive debt collection practices such as unauthorised disclosure of personal information, the use of threats and the defamation of borrowers, often disregarding existing financial consumer safeguards. To balance the growth of digital lending with recognised consumer safeguards, the study employs a doctrinal research approach to assess consumer protection mechanisms within Nigeria’s legal and institutional framework. The article proposes several recommendations, including promoting consumer awareness, expanding judicial and administrative channels of reporting and redress, improving and publishing regulatory activities, introducing fair digital lending rules, employing Enforcement Technology to facilitate monitoring and redress, fostering industry collaboration in data sharing, expanding the scope of formal entities providing credit, simplifying access to formal credit and strengthening credit reporting. These measures aim to establish a sustainable, inclusive and empowering digital lending environment for all stakeholders.

Suggested Citation

  • O. Monye, 2024. "Strengthening Nigeria’s Digital Money Lending Ecosystem," Journal of Consumer Policy, Springer, vol. 47(3), pages 445-458, September.
    • Handle: RePEc:kap:jcopol:v:47:y:2024:i:3:d:10.1007_s10603-024-09569-8
    DOI: 10.1007/s10603-024-09569-8
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    References listed on IDEAS

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    1. P. I. Omede, 2020. "A Tale of Two Markets: How Lower-end Borrowers Are Punished for Bank Regulatory Failures in Nigeria," Journal of Consumer Policy, Springer, vol. 43(3), pages 519-542, September.
    2. I. Ramsay & T. Williams, 2020. "Peering Forward, 10 Years After: International Policy and Consumer Credit Regulation," Journal of Consumer Policy, Springer, vol. 43(1), pages 209-226, March.
    3. K. Majamaa & A.-R. Lehtinen, 2022. "An Analysis of Finnish Debtors Who Defaulted in 2014–2016 Because of Unsecured Credit Products," Journal of Consumer Policy, Springer, vol. 45(4), pages 595-617, December.
    4. Folarin Akinbami & Franklin N Ngwu, 2016. "Overhauling the institutional structure of financial regulation in Nigeria: The unfinished reform," Journal of Banking Regulation, Palgrave Macmillan, vol. 17(4), pages 311-331, November.
    Full references (including those not matched with items on IDEAS)

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