Nigerian court clears FCCPC to enforce digital lending rules
A Lagos court has dismissed a legal challenge by an industry group, immediately restoring Nigeria's strict digital lending regulations and exposing non-compliant fintech lenders to penalties of up to 1% of turnover.
The Federal High Court in Lagos has dismissed a lawsuit that temporarily blocked Nigeria’s consumer protection regulator from overseeing digital lenders, clearing the way for immediate enforcement of strict new industry rules.
Justice A.L. Allagoa threw out the challenge brought by the Wireless Application Service Providers Association of Nigeria (WASPAN), an industry group representing digital service providers. The court declined all reliefs sought by the plaintiffs and discharged an interim order that had restrained the Federal Competition and Consumer Protection Commission (FCCPC). The judge ruled that the regulator acted within its statutory powers when drafting the Digital, Electronic, Online or Non Traditional Consumer Lending Regulations, known as the DEON Regulations.
For investors and operators in Nigeria’s fintech sector, the ruling removes a prolonged layer of regulatory uncertainty. The DEON Regulations, introduced in July 2025, initially gave operators a 90-day window to comply. They mandate that all online lenders register with the FCCPC and meet specific standards for data privacy, consumer protection and responsible lending.
The financial stakes for non-compliance are severe. Lenders that fail to adhere to the rules face fines reaching N100 million or 1% of their turnover. Additional enforcement measures include the suspension or revocation of operational approvals, as well as the disqualification of company directors.
The FCCPC had suspended implementation of the rules in April 2026 following the interim court order. Ondaje Ijagwu, the FCCPC’s Director of Corporate Affairs, said the regulator is now resuming its duties. “Now that the Court has affirmed the validity of the DEON Regulations and delivered judgment in favour of the Commission, we will continue to discharge our statutory responsibilities faithfully, professionally and in accordance with the law,” Ijagwu said.
The decision marks the second recent judicial endorsement of the FCCPC’s expanding regulatory reach. Earlier this month, a separate court affirmed the agency's authority to investigate consumer pricing complaints against airlines, distinguishing the act of investigating pricing from imposing price controls. For market participants, the consecutive rulings signal that Nigeria’s top consumer watchdog is successfully cementing its authority over digital and consumer-facing markets.
