FG Probes Online Banks Over Breach Of Customers’ Data Privacy

The federal government has begun to probe online banks over their alleged breaches of customers’ data privacy.

The Director-General, National Information Technology Development Agency, Kashifu Inuwa, made this known in Abuja on Monday.

Inuwa said that the agency was working with the Nigeria Police Force and other relevant agencies to investigate several lending platforms, popularly called loan shark platforms.

Inuwa said: “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.”

Recall, amidst outcry of data invasion by Nigerians against lending platforms, NITDA had imposed a fine of N10m on Soko Loan for data breach last August.

Reacting to the development, a tech policy analyst at Tech Hive Advisory Limited, 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 said: “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. However, we must not get carried away with that.”

Also, an ICT expert and Senior Partner at e86 Limited, Olugbenga Odeyemi, said some of the lending platforms were desperate to recover their loans, but it was unfair to breach their customers’ data privacy.

He, however, urged the government to strengthen privacy and data use laws, as well as protect lending platforms from serial loan defaulters.

Odeyemi said: “Loan shark platforms are infringing on the privacy of their users. They simply access the customer’s phone contacts and send out messages without authorisation.

“Some of the messages I’ve seen are outright threats and rather unnecessary.  While those platforms can argue that the users accepted their terms and conditions, I think the whole idea is unfair to their users.

“I personally think this is a matter of legislation, especially if we follow the examples of other countries which have done the same thing.

“We need to strengthen user privacy and data use laws in Nigeria. If we’re able to do that through the National Assembly, then loan sharks and other companies will have to comply.”