WASPAN challenges FCCPC’s digital lending powers at Court of Appeal

The Federal Competition and Consumer Protection Commission (FCCPC) has restarted the enforcement of the Digital, Electronic, Online or Non-Traditional Consumer Lending Regulations, 2025 (DEON Regulations), after a Federal High Court in Lagos ruled against a challenge to the regulations. The court's decision, delivered on Monday, cleared the way for the FCCPC to resume regulating digital lenders, which had previously faced a temporary halt due to an interim court order. The case was brought by the Wireless Application Service Providers Association of Nigeria Ltd/Gte (WASPAN), which argued that the FCCPC lacked the authority to impose the DEON Regulations. In Suit No. FHC/L/CS/760/2026, the court rejected all claims made by WASPAN and confirmed that the regulations were enacted within the FCCPC’s statutory and constitutional powers. Justice A.L. Allagoa, who presided over the case, ruled that the specific provisions of the DEON Regulations challenged by the plaintiff were valid and should remain in effect. As a result, the court lifted the interim order that had previously prevented the FCCPC from implementing the regulations. This order had been issued in April 2026, prompting the commission to temporarily suspend the enforcement of the DEON Regulations. With the legal obstacle removed, the FCCPC stated that the regulations are now fully operational and can be enforced without restriction. Speaking on behalf of the commission, Mr. Ondaje Ijagwu, Director of Corporate Affairs, emphasized the FCCPC’s commitment to upholding the rule of law and maintaining effective regulation. He noted that the commission had complied with the court’s interim order by halting the implementation of the regulations. “We have always maintained that the rule of law is fundamental to effective regulation and good governance,” Ijagwu said. He further explained that the DEON Regulations were designed to foster responsible lending practices, enhance regulatory accountability, combat unfair and exploitative behavior, and bolster consumer protection within Nigeria’s digital lending landscape. According to Ijagwu, the commission aims to balance innovation and financial inclusion with the need for transparency, fairness, and accountability in the digital lending industry. The FCCPC’s renewed focus on regulating digital lenders comes amid growing concerns about predatory lending practices and the lack of oversight in the rapidly expanding fintech sector. The DEON Regulations require digital lenders to adhere to strict guidelines on interest rates, disclosure requirements, and customer service standards. They also empower the FCCPC to investigate violations and take corrective actions against non-compliant operators. Industry representatives, including members of WASPAN, have expressed mixed reactions to the court’s ruling. Some acknowledge the importance of regulatory oversight in protecting consumers, while others argue that the regulations could stifle innovation and limit access to credit for underserved populations. The association had previously claimed that the FCCPC’s regulatory approach was overly restrictive and did not account for the dynamic nature of the digital lending market. Moving forward, the FCCPC plans to intensify its efforts to monitor compliance with the DEON Regulations. It will likely engage in outreach programs to educate digital lenders on their obligations and provide guidance on best practices. The commission has also indicated that it will work closely with other regulatory bodies and stakeholders to ensure a coordinated approach to overseeing the digital lending ecosystem. With the legal barriers removed, the FCCPC is poised to implement its regulatory framework more aggressively, aiming to create a safer and more equitable environment for both lenders and borrowers in Nigeria’s evolving financial services sector.