By: Nneka Oduada Eze (Esq)
Following the media briefing that was held to mark the Data Privacy Week in Abuja, The Director-General of National Information Technology Development Agency (NITDA) Malam Kashifu Inuwa Abdullahi disclosed on Monday, 24th January, 2022 that NITDA is working with the Nigeria Police Force and other relevant agencies to investigate several lending platforms, popularly called loan shark platforms. The Federal Government has begun a probe of online banks over their alleged breaches of customers’ data privacy amidst the outcry of data invasion by Nigerians against lending platforms.
This announcement was made by the director of NITDA while addressing journalists ahead of the National Privacy Week 2022. According to Malam Kashifu, he stated that:-
“We are working with relevant agencies to make sure we address that challenge because it is not only NITDA’s mandate that governs everything. When you talk about any financial services, it is the CBN. When you talk about general complaints, there is a commission for that. But NITDA plays a critical role because of the breach of data privacy.
“We have sanctioned some of them. We are working with the Nigerian police, investigating many of them. We are working to address the challenge”.
NITDA had earlier imposed a fine of N10million on Soko Loan (an online company) for data breach in August 2021, to serve as a warning for the consistent breach of some Data subject’s privacy. In November 2021, NITDA partnered with the Federal Competition and Consumer Protection Commission to address the increasing rates of data privacy abuse by money lending organizations, particularly fin-tech firms.
In reaction to this development, a tech policy analyst at Tech Hive Advisory Limited, by name Tolulope Ogundele, urged the Federal Government to adopt a multi-stakeholder approach by involving the private sector in order to enhance a better understanding of the lending sector. She further stated that “It goes beyond just working or collaborating with other agencies; a multi-stakeholder approach must be adopted. The government must seek the involvement of the private sector in order to understand the lending sector. Before these collaborations amount to any form of regulation, there is a cogent need to thoroughly understand the lending industry and the role of its players but the move to collaborate is a good step and start by the government”.
Loan shark platforms are heavily infringing on the privacy of their users. They access the customer’s phone contacts and send out messages without authorization. Some of these messages poses as outright threats and screams desperation on the part of these lenders.
The step taken by the federal government is a welcome development as many Nigerians are not spared from the consistent breach of their privacy by these online banking platforms. However, it is also important to see through the eyes of these platforms, despite their faulty approach vide unsolicited messages and threats; the rationale remains to recover their debt from loan defaulters. They eventually breach the user’s privacy when these defaulters become unresponsive.
The government must take deliberate steps in protecting these businesses while ensuring strict adherence to the data policy regime, particularly with the near impossibility of an average Nigerian securing easy access loans from commercial banks. There is need for clear-cut policy, regulatory, institutional and legislative frameworks to streamline the modus operandi of these lending platforms, strengthen user privacy and data thereto and discourage serial loan defaulters
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