The House of Representatives on Wednesday unveiled plans to investigate the activities of online loan providers nationwide.
The resolution was adopted following the adoption of a motion sponsored by the Hon. Akin Alabi, on “The Need for Strict Measures to Reduce Excesses by Online Service Providers”.
In his main debate, Honorable Alabi observed that to cushion the impact of COVID-19, an increasing number of Nigerians have turned to digital lenders to address urgent financial needs as traditional financial institutions are often laborious.
He noted, however, that several lending platforms were operating outside the principles of lawful processing of personal data, as required by Nigerian data protection regulations and other relevant provisions.
“The Chamber is also concerned that many online providers are exploiting the growing need for financial assistance to engage in unfair collection practices by subjecting Nigerians to situations where their contacts are besieged by unsolicited messages in the Internet. purpose of forcing borrowers to pay.
The House is troubled that online loan providers have resorted to a pesky habit of shame as a tactic to trick their customers into paying and taking action which amounts to a breach of privacy, intimidation and harassment.
“The Chamber is also concerned that some online lenders operating in the country do not have a privacy notice, while some privacy notices from those who do are often not comprehensive enough to explain how the data of a user are processed.
“The Chamber is concerned that loan company collectors are mostly unprofessional and often apply unethical methods, including impersonation of lawyers and security guards, in the process. purpose of recovering funds borrowed from defaulting customers.
“The Chamber is aware that the Nigerian data protection regulations were established due to the recognition by the government that information must be safeguarded, regulated and protected against atrocious breaches,” he noted.
For his part, in the debate, Hon.Amadi Dennis (PDP-Enugu), who urged the Hos to be cautious, underscored the need for regulators that have authorized operators to ensure compliance with laws in force.
Worried about the development, the House tasked CBN with putting in place workable regulations to curb the extremism of unscrupulous online loan providers in Nigeria.
Lawmakers have also highlighted the need for subnational governments to put in place more stringent regulations to protect the interests of third parties from receiving unsolicited messages.
They also insisted on the need for the National Information Technology Development Agency (NITDA) to ensure strict compliance with Nigeria’s data protection regulations by all online loan providers.
To that end, the House mandated the joint commissions on banking and currency, communications and human rights to investigate the matter and report back within two weeks for further legislative action.
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