Lagos: Digital lenders under the Money Lenders Association (MLA) have praised Nigeria’s democracy for promoting financial inclusion. They said democratic governance had expanded access to credit for underserved individuals and small businesses nationwide.
According to News Agency of Nigeria, Mr. Gbemi Adelekan, MLA Chairman and Group Managing Director of Trafalgar Associates Ltd., made the remarks during an interview in Lagos. Adelekan said democracy and the rule of law had created a suitable environment for digital lending. He noted that the sector was contributing to economic growth, financial inclusion, and MSME empowerment. He emphasized the importance of a strong democracy for economic growth and development that benefits all Nigerians, including many MSMEs that depend on digital lenders for emergency funding and business growth.
The MLA chairman highlighted that democracy promoted trust, fairness, and transparency within the financial ecosystem, adding that digital lenders provided critical services s
upporting a sustainable Nigerian economy. According to him, digital lenders have helped bridge gaps left by conventional banking institutions, supporting low-income earners and informal sector operators with accessible credit.
Adelekan noted that despite improvements, many Nigerians remained outside the formal banking system, creating opportunities for digital lending platforms to provide solutions. He explained that internet growth and mobile technology accelerated digital lending adoption, with borrowers accessing collateral-free loans through mobile applications and USSD platforms. He said digital lending had reached both rural and urban communities across Nigeria, providing timely access to credit that helps individuals and businesses manage cash flow challenges, address emergency liquidity needs, and improve livelihoods.
He added that MSMEs could expand operations and create jobs through working capital support. Adelekan commended regulatory interventions by the Federal Competition and Consumer Protect
ion Commission (FCCPC), describing the measures as important steps towards sanitizing the digital lending industry. He said enforcement against unregistered operators improved consumer protection and industry standards, and that licensing requirements had strengthened confidence among consumers and investors.
Adelekan called for more reforms to improve the digital lending ecosystem, especially debt recovery. He urged the government to create effective frameworks for recovering legitimate outstanding loans and recommended measures to discourage deliberate defaults by borrowers. He advocated for licensed lenders’ access to the Global Standing Instruction (GSI) framework, stating that the move would aid recovery from borrowers with multiple accounts. He proposed small claims digital courts for faster loan dispute resolutions, supporting low-value consumer loan recovery processes.
He also urged increased financial literacy campaigns to promote responsible borrowing, stressing that youths need to understand the
consequences of borrowing from multiple lenders. Adelekan expressed confidence in the sector’s future with stronger regulations and education, stating that improved systems would continue supporting Nigeria’s economic development and inclusion.