Unfortunately, pausing DEON 2025 will send the wrong signal to consumers, startups and investors. The message is that rules are political, not institutional. That scale beats compliance, and consumers aren’t worthy of protection. Hence, while stakeholder engagement is essential, the outcome cannot be paralysis. Nigerians cannot afford their digital economy to be captured by corporate sharks with deep pockets who care more about their balance sheets than the local economy.
By any objective measure, Nigeria’s digital lending market has grown faster than its regulatory safeguards. What FCCPC’s Digital, Electronic, Online or Non-Traditional Consumer Lending Regulations 2025 (DEON 2025) sought to do was not to stifle innovation, but to civilise it.
The recent decision by the House of Representatives Ad Hoc Committee to suspend the DEON Regulations, citing investor confidence, regulatory overlap, and ease of doing business, raises a fundamental question: Who truly benefits from regulatory silence in Nigeria’s digital lending ecosystem?
Regulation, when evidence-based and done without bias, is not the enemy of investment, as alleged by several detractors. Across global markets, clear rules attract capital, while uncertainty repels it. Investors do not fear regulation; what they fear is arbitrary power, data abuse, reputational risk, and legal backlash.
In Nigeria’s case, unregulated digital lending has already resulted in abusive debt collection practices, illegal access to consumer contact lists, cross-border data harvesting, and predatory interest structures hidden behind airtime-based or wallet-based lending. Left unchecked, these practices damage Nigeria’s fintech ecosystem and deter long-term institutional capital.
Curiously, the loudest opposition to DEON 2025 has not come from early-stage Nigerian fintechs or MSME lenders. It has come from large telecommunications companies and dominant airtime-aggregation platforms, whose market power allows them to control consumer access channels, bundle financial services without consumer transparency, leverage scale to outlast regulatory delays, and squeeze smaller Nigerian lenders out of the market.
Sadly, suspending DEON 2025 reinforces an uneven playing field in favour of incumbents and stifles innovation. Because for indigenous digital lenders, regulation is protection, not punishment. DEON 2025 establishes licensing clarity, consumer data boundaries, disclosure standards and fair collection practices. Without this framework, Nigerian startups will inadvertently face capital starvation, while dominant players continue extracting value without accountability.
The global reality is that Nigeria is not reinventing the wheel. In India, the RBI Digital Lending Guidelines led to a significant reduction in consumer abuse, increased institutional funding, and a more competitive fintech ecosystem. In Kenya, mandatory licensing, through the Digital Credit Providers Regulations, stabilised the market and improved consumer trust after several years of abuse. Similarly, stronger consumer rules in the European Union expanded fintech participation and spurred growth. In all these cases, regulation preceded sustainable growth.
Unfortunately, pausing DEON 2025 will send the wrong signal to consumers, startups and investors. The message is that rules are political, not institutional. That scale beats compliance, and consumers aren’t worthy of protection. Hence, while stakeholder engagement is essential, the outcome cannot be paralysis. Nigerians cannot afford their digital economy to be captured by corporate sharks with deep pockets who care more about their balance sheets than the local economy. We need rules that protect competition, consumers, and confidence.
Ayodele Adio is a media and communications strategist.
