- The recent removal of Babatunde Irukera, CEO of the Federal Competition and Consumer Protection Commission (FCCPC), has created a gap in consumer protection in Nigeria, particularly affecting the digital lending space.
- Irukera played a significant role in sanitizing the operations of loan apps, addressing issues such as harassment and unethical practices.
- While a new CEO is expected to be announced for the Commission anytime soon, it is uncertain if the new leader will sustain the reforms initiated by Irukera towards sanitizing the digital lending space in the country.
The recent removal of the Chief Executive Officer of the Federal Competition and Consumer Protection Commission (FCCPC), Babatunde Irukera, could leave a gap in the consumer protection space in Nigeria, but more so in the digital lending space, where the former FCCPC boss was fighting the tough battle of sanitizing the operation of loan apps in the country.
President Bola Tinubu on Monday announced the dismissal of Irukera alongside the CEO of the Bureau of Public Enterprises (BPE), Alexander Okoh. According to a statement from the Presidency, the dismissal stems from the administration’s drive to restructure and reposition critical agencies of the federal government.
The two dismissed Chief Executives were directed to hand over to the next most senior officer in their respective agencies, pending the appointment of new Chief Executive Officers.
FCCPC under Irukera
Aside from the Commission’s exploits in addressing consumer issues in every sector of the economy, Irukera paid special attention to the digital lending space where hundreds of companies were engaging in unethical practices of forcing loans on people and using harassment and defamation, among other unethical means to recover the loans.
With some successes recorded, especially by bringing the disorderly loan apps under some form of control through the Interim Limited Registration Framework and Guidelines, the FCPCC under Irukera made a bold statement in the market.
Although some users of these digital lending platforms would argue that harassment and defamation of borrowers have not been reduced, many of the registered digital lenders are now abiding by the conditions of their registration, which forbid them from using unethical means for loan disbursement and recovery.
- As of December 2023, 241 digital lenders have been registered by the Commission. These comprise 203 with full approval and 38 with conditional approval.
- Outside these, some 85 unregistered other loan apps suspected of engaging in all forms of illegal practices are said to be under the watchlist of the Commission.
- Also, through a collaborative effort with Google, a total of 47 loan apps operating illegally in Nigeria have been removed from the Google Play Store.
Rising debt
But the war is far from over. Indeed, according to the erstwhile FCCPC boss, registration of digital lenders was just the first step in the reforms needed to sanitize the lending space. This was why just a few days ago, Irukera, obviously without an inkling of what the days after would bring, announced that the Commission would this year come up with a new regulation to address the high rate of default by borrowers from loan apps, which he described as the big issue.
According to him, while the Commission has succeeded in reducing abuse and harassment by the loan apps, Nigerians taking loans from the platforms have continued to default. Irukera said the rising debt could lead to the collapse of the digital lenders that are also playing critical roles in the economy.
- “One of the big issues that we’re seeing is that there’s now a significant level of loan default because people are not able to use these unethical and inappropriate loan recovery mechanisms and I’m insistent that you cannot say to me that the only language Nigerians understand is to abuse them. No, I disagree.
- “We must necessarily do the work no matter how hard it is to find a more sensible way to recover loans because I also agree that if these digital money lenders are unable to recover their loans and drop out of the market, it’s a consumer protection problem because of those who need those types of short-term unsecured lending.
- “So, we have to find the balance and so some of the regulations that will come out in 2024 will be a broader approach to responsible borrowing and responsible lending by individuals and corporates. I’m hopeful that the future of what we’re building is that even school landlords would be able to report to a centralized credit system about the conduct of tenants, students, and parents so that we can know each person’s level of fiscal responsibility or credit wordiness.” Irukera said during an interview in December.
Transforming the FCCPC
Beyond the regulation of digital lenders, Irukera brought the FCCPC out as a government agency truly representing the interests of Nigerian consumers.
Through Irukera’s interventions even via social media platforms like X (Twitter), many Nigerians had gotten reprieves in situations where they would have been cheated by the businesses they were dealing with.
Irukera’s ability to bring to their knees the otherwise powerful local and international companies infringing on consumer rights and making them accountable was seen as a feat never achieved before him at the FCCPC.
At a strategic media engagement in Abuja in December, Babatunde Irukera shared how at the helm of affairs in the FCCPC, he had turned around the fortunes of the Commission from dependent on government subvention to a self-funding Agency.
In 2023, the FCCPC generated over N56 billion, where 90% of the Internally Generated Revenue (IGR) was obtained through payment of penalties by defaulting companies in the country. He said that the FCCPC remitted N22.4 billion to the federal government.
- “In 2023, our internally generated revenue is already N56bn, and we have remitted to the government N22.4 billion and for me what this demonstrates is the real possibility for our country. Our possibilities are limitless.
- “We don’t approve a single product; we don’t take fees for registration of anything nor support or sponsorship from companies. All our revenue, at least 90%, is from penalties. We believe that the market should be unlocked, and businesses should be allowed to operate well and should thrive.
- “But we also believe in consequence and businesses must be held accountable, if we don’t hold people accountable, we can’t promote good behaviour. “Before 2017, the FCCPC had a budget of N1 billion from the Federal Government, of this amount, N511 million was personal costs and salaries of 240 employees at the time,” he said.
Awaiting the new FCCPC CEO
With the leadership position of the FCCPC currently vacant, it is expected that President Tinubu will announce the appointment of a new CEO for the Commission either in the coming days or weeks. However, it is uncertain if the would-be CEO will lead the Commission with the same passion and zeal with which Irukera had led the organization.
It is hoped that the incoming CEO will build on Irukera’s legacy and carry on with the reforms started by the outgoing CEO.
The digital loans companies have indulge in unethical practices which causes many Nigerians to commit suicide and that was before the coming into the issue by FCCPC BABA TUNDE IRUKERA HONESTLY HE SHOULD BE COMMENDED AND HOPE THE INCOMING NEW CHAIRMAN SHOULD CONTINUE THE GOOD WORK OF IRUKERA
BAT was also fined and am informed he was gunning for the Vampires in the Telco sector
So this removal is actually a dis service to Nigeria .