Regulatory dispute renews fear over Nigeria’s telecom credit services

Fresh uncertainty has emerged over Nigeria’s telecom-based airtime and data lending market as the Wireless Application Service Providers Association of Nigeria (WASPAN) warns that continued enforcement of the Federal Competition and Consumer Protection Commission’s (FCCPC) Digital, Electronic, Online or Non-Traditional Consumer Lending Regulations, 2025 (DEON Regulations), could trigger another disruption to services used by millions of subscribers.

The association has asked the Court of Appeal to suspend enforcement of the regulations pending the determination of its appeal against the July 20 judgment of the Federal High Court in Lagos, arguing that immediate implementation could expose operators to sanctions, heighten regulatory uncertainty and disrupt telecom-enabled credit services.

Industry stakeholders say the earlier interruption in airtime lending highlighted the growing importance of the service to Nigeria’s digital economy.

According to the Chairman of the Association of Licensed Telecommunications Operators of Nigeria (ALTON), Gbenga Adebayo, the disruption demonstrated that airtime credit had evolved beyond a simple telecommunications offering.

“What this episode demonstrated is that airtime credit is not a financial product in the way regulators initially characterised it. It is economic infrastructure that approximately 40 million people use regularly, with the vast majority of them at the base of the economy,” Adebayo said.

The concerns are also resonating with subscribers who rely on airtime and data advances to stay connected.

Seun Sofoluwe, an Abeokuta-based worker, said another disruption would be difficult for many Nigerians who depend on the service for everyday communication.

“A lot of people depend on the services, and it will be very bad for them, especially those who are so reliant on it that they do debt-to-debt servicing,” he said.

Debt-to-debt servicing refers to the practice of repaying an outstanding airtime loan immediately to qualify for another advance, reflecting the extent to which some subscribers rely on the facility for continuous access to voice and data services.

Sofoluwe’s concerns mirror the experience of Lagos-based employee Farouk Rabiu, who described the hardship caused by the six-month disruption that preceded the restoration of airtime lending services.

“I was devastated because, after exhausting my data, I was hoping to borrow credit to access my bank account. Instead, it was a major disappointment,” Rabiu recalled after the services resumed.

WASPAN maintains that enforcing the DEON Regulations while its appeal is pending would prejudice its members, who are licensed by the Nigerian Communications Commission (NCC), and could disrupt the delivery of airtime credit, data advances and other telecom-enabled digital lending products.

The FCCPC, however, insists the regulations are necessary to sanitise the digital lending industry, curb predatory debt recovery practices, protect consumer data and eliminate illegal digital lenders.

The Court of Appeal’s decision on whether to suspend enforcement pending the appeal is expected to shape the regulatory landscape for telecom-based digital lending and determine whether operators can continue providing uninterrupted airtime and data credit services while the legal dispute is resolved.