FG orders the removal of illegal loan apps from Google Play Store

The Nigerian FG under the Federal Competition and Consumer Protection Commission (FCCPC) has demanded tech giant Google to take down four loan apps that are being used for questionable practices from the Play Store. These loan apps include Maxi Credit, Here4U, ChaCha, and SoftPay.

According to the Commission, its investigations found  that the blacklisted apps are operated by other well-known services that are being probed for unethical behavior and privacy violations by users. It specifically identified Soko Loan as the entity behind a number of other apps that were being used to evade the Commission's efforts.

The National Information Technology Development Agency (NITDA) penalized Soko Lending Company Limited N10 million in August 2021 for violating users' privacy.

At the FCCPC's request, the Soko Loan app was taken down from the Google Play store.

Babatunde Irukera, the Executive Vice Chairman of the FCCPC, stated that based on the evidence provided to the Commission, Soko Loan seems to be the biggest digital money lender, with several third party apps and brand names controlling a sizeable portion of the online lending market. Soko Loan is also one of the most active violators of consumer privacy and other loan recovery practices.

“The Commission has also today entered further orders that will disable or diminish violators’ ability to devise circumvention efforts or alternative mechanisms to circumvent the objective of the investigation and protection of citizens. Particularly, the Commission has entered further Orders to Google Play Store to draw down the following apps which were discovered to be created and operating as a circumvention of existing investigative interventions; Maxi Credit, Here4U, ChaCha, and SoftPay,” Irukera said.

Most recently, the Commission ordered certain payment platforms to cease operations with digital lending platforms under probe.

Fluttewvave, Opay, Paystack, and Monify are among the payment services that have been ordered by the commission to immediately stop and desist from offering services to unethical lenders under investigation or that are not operating in accordance with the necessary regulatory requirements. The Commission has further ordered telecommunications and technology firms, including mobile network operators (MNOs), to stop offering server and hosting services and other essential services, like connectivity, to the concerned lenders.

Irukera continued by saying that the Commission would keep track of the services not available on Play Store but run these illegal operations on other platforms. 

On March 11, the Federal Government clamped down on some unauthorised digital lending services through an operation carried out by its joint committee looking into rights violations and unfair practices because they had not registered with the Corporate Affairs Commission (CAC) and had been acting in ways that violated Nigerian consumers' rights.

In addition to other infractions, these online financial services charged interest rates that go against the morals of lending and engaged in naming and shaming, which violates people's privacy when it comes to the ways these lenders recover loans.

The lending organizations provide short-term loans to its consumers so they may meet urgent requirements, but they also engage in unethical practices such harassing customers who could have missed loan payments, cyberbullying, and data breaches.

However, some of the lenders under scrutiny have developed strategies to go around asset freezing and app suspension Orders by utilizing other technology service alternatives. He added that the Commission expects a substantial incremental reduction in these inappropriate behaviors with the activities already in place.

Additionally, the Commission today issued new instructions that will make it harder for violators to come up with creative ways to get around the investigation's goals and the protection of residents.