Nigeria's digital lending market is expanding, but experts say gaps in data sharing, affordability assessment and consumer protection could limit its ability to scale sustainably.
For this story, ITWeb Africa spoke to banking, fintech and credit professionals about Nigeria's evolving consumer-credit market, covering credit scoring, alternative data, digital lending, Buy Now, Pay Later, credit reporting and consumer protection.
They identified persistent gaps in data sharing, affordability assessment and the responsible use of alternative data.
The size of Nigeria's consumer-credit market underscores the stakes. The Central Bank of Nigeria reported consumer credit outstanding at ₦4.27 trillion (about $2.8 billion) in June 2025, up 6.48% from March, with personal loans accounting for 54.1% and retail loans making up the balance.
"Nigeria's lending problem is no longer a data shortage. It's a data-sharing and trust problem," said Olumide Durotoluwa, senior product manager at M-KOPA.
Durotoluwa said the Bank Verification Number, National Identification Number and credit bureaus have improved data access, but weak repayment reporting can leave responsible borrowers without portable credit histories.
He said behavioural alternative data, including repayment on pay-as-you-go assets, airtime and mobile wallets, can provide stronger signals than demographic, social or device data, and argued that repayment structures should reflect borrowers' irregular incomes rather than rigid lender schedules.
Haris Santana, a banking professional and branch manager at Bank Kalsel in Indonesia, said four foundations are essential for digital lending: reliable credit data, effective scoring, strong Know Your Customer systems and robust risk-management infrastructure.
Santana said lenders should combine credit data, income, existing obligations and repayment history, warning that speed should not come at the expense of affordability assessment.
His emphasis on affordability comes as Nigeria tightens its regulatory framework.
The Federal Competition and Consumer Protection Commission introduced its Digital, Electronic, Online, or Non-Traditional Consumer Lending Regulations in 2025, covering transparency, data protection, responsible lending and recovery practices.
Naeem Siddiqi, senior advisor in risk and quantitative research at SAS Institute and an author on credit scoring, urged Nigeria to improve the quality of data available to lenders.
He pointed to rent and utility payments and open-banking access to bank transactions as useful signals for borrowers with limited credit histories.
But Siddiqi warned against relying heavily on cellphone or online data that can be manipulated or whose relationship with repayment is questionable, saying such approaches can push lenders toward high-risk portfolios and expensive credit.
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