Nigeria's Financial System Under Scrutiny as Consumer Complaints Surge

Nigeria's rapidly expanding financial ecosystem is facing an unprecedented consumer protection crisis, with regulators resolving more than 9,000 complaints and recovering over ₦10 billion in just six months. Between March and August 2025, the Federal Competition and Consumer Protection Commission (FCCPC) documented 4,615 grievances against banks and fintech companies—the highest concentration of consumer complaints across all Nigerian sectors—raising serious questions about the stability and trustworthiness of Africa's largest financial market.

The surge in complaints coincides with a dramatic 45% increase in fraud incidents, according to Central Bank of Nigeria data, with digital platforms accounting for 70% of ₦11 billion in losses. These figures reveal deepening vulnerabilities in Nigeria's digital financial infrastructure as the country pushes toward greater financial inclusion and a $1 trillion economy by 2030.

Background and Context

Nigeria's consumer protection framework operates through a complex web of regulations overseen by multiple agencies. The Federal Competition and Consumer Protection Commission, established under the FCCPA 2018, serves as the apex consumer protection authority, while the Central Bank of Nigeria maintains sector-specific oversight through the BOFIA 2020 banking regulations. This dual system, while providing multiple avenues for redress, often creates confusion about ultimate regulatory authority.

The introduction of the 2025 DEON Regulations represents the most recent attempt to curb harassment, data misuse, and unethical practices in digital lending. Yet enforcement challenges persist, with many violations going unpunished due to regulatory overlap and limited capacity.

Key Figures and Entities

According to FCCPC complaint data, banking institutions generated 3,173 complaints during the six-month period, followed by fintech companies with 1,442 grievances. The scale of these complaints dwarfs other sectors, including Fast Moving Consumer Goods (1,543 complaints) and electricity providers (458 complaints), highlighting systemic issues in financial services delivery.

Court records and regulatory filings show that digital lenders have emerged as particularly problematic actors. The FCCPC's enforcement actions against these companies document patterns of privacy violations, exploitative interest rates, and aggressive debt recovery tactics including public shaming of borrowers. Despite these findings, many digital lending platforms continue operating with minimal oversight.

Legal and Financial Mechanisms

Network failures represent the most common complaint category, with consumers reporting unexpected fees, missing funds, and agent overcharges. Research indicates that only half of consumers accurately recall fees for their most recent transactions, suggesting fundamental failures in transparency and communication from financial institutions.

Unauthorized deductions continue to plague the sector despite existing regulations. More alarmingly, fraud statistics from the CBN show financial institutions lost ₦52.26 billion to fraud in 2024—nearly triple the previous year's losses of ₦17.67 billion. Fifty-eight percent of digital financial services users reported receiving fraudulent phone calls or text messages requesting passwords or payments.

Digital lending abuses present another critical vulnerability. Studies reveal that 37% of digital credit users have been unable to repay loans, with 60% reporting significant sacrifices to meet repayment obligations. The FCCPC's enforcement orders detail how lenders systematically violate consumer rights through questionable repayment enforcement practices and opaque loan calculations.

International Implications and Policy Response

The erosion of trust in Nigeria's financial system carries far-reaching implications for the country's economic ambitions. When consumers abandon formal financial services due to poor experiences, Nigeria's financial inclusion objectives suffer significant setbacks. The World Bank has repeatedly emphasized that consumer protection is foundational to building inclusive financial systems in emerging markets.

Emerging technologies present new challenges that regulators are struggling to address. The CBN's open banking framework, while promising increased competition and innovation, creates fresh vulnerabilities around data security and privacy. Similarly, the growing use of AI in credit decisions and customer service raises concerns about algorithmic bias and lack of transparency—issues that current regulatory frameworks are ill-equipped to handle.

The Investment and Securities Act 2025 recently classified virtual and digital assets as securities, bringing cryptocurrency under regulatory oversight. However, the inherent vulnerabilities of digital assets to fraud demand more sophisticated protection frameworks than currently exist.

Sources

This report draws on FCCPC complaint databases and regulatory reports, Central Bank of Nigeria fraud statistics and policy documents, the Federal Competition and Consumer Protection Act 2018, and Banking and Other Financial Institutions Act 2020. Additional context comes from World Bank research on financial inclusion and consumer protection studies conducted between 2023 and 2025.