The Federal Competition and Consumer Protection Commission (FCCPC) has barred all financial technology companies (FinTechs) from providing payment or transaction services to online money lenders under its investigation.
The identified FinTechs such as Flutterwave, Opay, Paystack and Monify were said to be operating payment systems and providing services to such online lenders under its investigation or not operating with applicable regulatory.
Irukera said the commission also ordered telecommunication and technology companies which include mobile network operators (MNOs) to stop providing server, hosting or other key services such as connectivity to such disclosed or known lenders.
According to him, the Federal High Court empowers the commission to search and seize items from the premises of targets and subjects of investigation.
This, he said, made the commission to enforce the law against a company, widely known as Soko Lending Ltd.
“The information available to the commission demonstrates that Soko Lending appears to be the most consequential digital money lender with multiple apps and brand names.
“It is covering a significant share of the digital or online lending market, and one of the most prolific actors in violating consumer privacy, fair lending terms and ethical loan repayment/recovery practices.
“Prior to this operation, the commission had previously, on March 11, 2022 carried out a similar enforcement action with respect to multiple lenders; which action and continuing investigation has reduced previously high and escalating unethical, obnoxious and unscrupulously exploitative practices in the industry,” he said.
Irukera, however, said some of the lenders who had been subject of investigation devised methods to leverage technology and other financial services alternatives to circumvent account freezing and app suspension orders.
“With the operations today, the commission expects appreciable additional reduction in these unacceptable practices,” the FCCPC boss noted.
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