Introduction

According to the FCCPC (Federal Competition and Consumer Protection Commission (FCCPC), over 46 illegal bank apps were delisted and removed from play store in the year 2024 alone. 

The growth of digital lending in Nigeria has made it quite effortless to secure loans using just a smartphone, and as of today, over 400 loan apps are formally registered under the FCCPC’s 2022 regulatory framework. However, this registration is not foolproof and can be a double-edged sword. In the meantime, borrowers still fall prey to unlicensed loan apps with outrageous interest rates. One case went viral where a borrower was offered a ₦2.5 million loan that escalated into ₦6.4 million in total repayment, an extra ₦3.9 million, amounting to a staggering 198% APR.

It is clear: as convenient as online lending may seem, the risk of scams is even more real. From apps that demand excessive interest rates to those that harass your contacts, steal your personal information, access your pictures, or intrude into other applications on your smartphone, unregulated loan apps are everywhere.

To avoid falling victim to scammers, borrowers are advised to use loan apps licensed by the Central Bank of Nigeria (CBN) and monitored by bodies like the Federal Competition and Consumer Protection Commission (FCCPC). The main challenge is telling genuine platforms apart from fake ones. This guide will show you how to confirm CBN-approved apps, spot common scam tactics, and adopt safe borrowing practices in Nigeria.

Why You Should Avoid Unapproved Loan Apps

Loan apps without regulation might appear easy, but often exploit borrowers through unethical practices. Common risks include:

• Exorbitant Interest Rates
  Illegal loan apps charge above standard lending rates, putting borrowers in a perpetual debt cycle, sometimes tripling repayment amounts with hidden charges.

• Invasion of Privacy
  These apps frequently demand access to your phone contacts, then misuse the information by calling or texting your friends, colleagues, or contact list in general  , regardless of your relationship with them, in an attempt to shame or pressure you into repayment.

• Defamation and Harassment
  Borrowers have reported apps sending defamatory messages to contacts, spreading false claims, hurling insults, or even falsely declaring a borrower “dead” to create fear and embarrassment.

• Blackmail and Threats
  After illegally accessing sensitive data such as private messages or photos, some apps threaten to publish this information unless borrowers comply with repayment demands.

• Lack of Data Protection
  Without proper data management policies, illegal loan apps who are not legally under the law can misuse, expose or even give out your personal details, putting you at risk of fraud and identity theft.

• Fake or Unstable Identities
  Many operate under multiple or constantly changing names, especially after being banned,  to evade detection, being traced or accountability.

• No Legitimate Customer Support
  When issues arise, borrowers are left stranded due to lack of  functional helplines, email support, or physical office addresses.

Borrowing from these apps not only exposes you to financial exploitation but also puts your personal data and life at risk of  identity theft leading to privacy invasion and emotional distress. In the extreme cases, these apps are run by criminal syndicates disguising themselves as financial institutions.

Who Regulates Loan Apps in Nigeria?

Several government agencies oversee digital lenders in Nigeria:

1. Central Bank of Nigeria (CBN) – ensures financial licenses and compliance with banking regulations. 
2. Federal Competition and Consumer Protection Commission (FCCPC) – ensures consumer protection, takes consumer complaints and enforces fairness.
3. National Information Technology Development Agency (NITDA) – protects the data privacy and information technology of users.  
4. Economic and Financial Crimes Commission (EFCC) – investigates fraud, illegal organizations and financial crimes.

The FCCPC spearheads the registration and overseeing of digital lending platforms, working in partnership with the CBN and NITDA. Only apps that meet the required compliance standards are included on the FCCPC’s official list of approved loan apps.

How to Identify CBN-Approved or FCCPC-Licensed Loan Apps

1. Check the FCCPC’s List of Approved Loan Apps

Begin by checking the FCCPC’s official website for the most updated list of licensed digital lenders:

https://www.fccpc.gov.ng

They provide a downloadable list with:

The site offers a downloadable document that contains:

• The name of the loan app.
• The company’s registered name and RC number
• Official contact information
• Approval status (either fully approved or conditionally approved).

Note: Any loan app absent from the list is not legally authorized to operate in Nigeria.

2. Confirm the Company’s Registration with CAC

For a loan app to be CBN-approved, it must operate as a registered business in Nigeria. This can be verified  by searching up the company details on the Corporate Affairs Commission (CAC) portal using the company’s name or RC number :

https://search.cac.gov.ng

3. Check for BVN and NIN Integration

Registered loan apps follow the CBN’s Know-Your-Customer (KYC) rules. They don’t just request your phone number with no identity verification but request your: 

• Full name, date of birth, address
• Bank account details
• Bank Verification Number (BVN)
• National Identification Number (NIN).

4. Review App Permissions Before Installing

 CBN and FCCPC regulated apps require only mininmal permission and ask for only essential data in line with the “Nigeria’s Data Protection Act.” App permission differs on phone models, permissions appear upfront on Android as you install , on iOS or iPhones, permission appears when the app tries to access data. Possible illegal requests to access might be: 

• Your contact list
• Call logs and SMS
• Your gallery or media files
• Location at all times

5. Evaluate Customer Reviews and Ratings

Visit the Google Play Store or Apple App Store and search the app’s name. Look out for reviews mentioning; Transparency, customer service, interest rates, contact harassment, fake names, double charges, defamation or threats, sudden account lockouts. 

Consistent bad reviews often indicate an app you should run from.  

6. Examine the Interest Rates , Loan Terms. 

Read the terms and conditions properly. Never be in a rush. Legal lenders are mandated to provide:

• Defined repayment periods (7–180 days)
• Clear interest rates (20%–35% APR) and not flat rates. 
• Reasonable fees and charges

Scam apps may advertise:

• Zero interest rates or flat rates  with hidden charges. 
• Fake promotions 
• Confusing repayment terms

7. Confirm the Loan App’s Contact Details.

Always check for :

• A functional customer support number
• A working mail 
• A full physical business address, not vague details like “Ibadan, Nigeria”.

List of Some FCCPC-Approved Loan Apps (As of 2025)

Below are  few examples of legal loan apps:

Note: Always fact-check with the FCCPC for recent updates and upgrades.

What to Do If You’ve Already Borrowed from a Scam App

1. Repayments

Pay Back What You Can If you borrowed money and agreed to terms that were unreasonable, try to repay what you owe to avoid legal repercussions.

2. Report the App

Report to:

• FCCPC: contact@fccpc.gov.ng
• NITDA (for data abuse): info@nitda.gov.ng
• Google Play Store – report the app as inappropriate and drop a review. 

3. Document Any Harassment

Keep records of calls, messages, or defamatory remarks. This can back up legal or regulatory action. In case of harassment escalation, the credit bureau dispute rights might be employed. 

4. Warn Others

To help others learn, share your experience online. People are less likely to fall into the trap when they are more informed.

Quick key takeaways 

1. Only borrow from approved and  regulated apps.
2. Go over the loan terms and conditions, app permissions, app ratings and customer service options cautiously. 
3. If it seems too good to be true, it probably is actually too good to be true. 
4. Notify relevant authorities about fraudulent apps. 
5. Repay your loans on time to maintain a good credit score
6. Monitor your credit report via CRC, FirstCentral, or CreditRegistry
7. Never give access to your contacts or sensitive files

Conclusion

Borrowing should bring relief, not loss of dignity and shame. Borrow what you can repay responsibly, stay informed, and never give up your privacy or dignity for a quick loan.