Access Holdings Plc, the parent group of Access Bank has received the CBN’s approval-in-principle to set up its own consumer lending subsidiary which will be known as Oxygen X Finance Company Limited.
According to a corporate disclosure on the NGX website obtained by Nairametrics, the company will commence operation when the final approval is obtained from the CBN.
In the disclosure signed by Sunday Ekwochi, Access Holdings’ Company Secretary, Oxygen X is expected to “make a positive impact on the financial landscape by providing innovative and seamless digital lending solutions to address distinct challenges faced by individuals and businesses in our rapidly evolving world.”
The consumer lending industry in Nigeria is a growing industry, driven by the rising cost of living in the country. In an earlier Nairametrics report, it was noted that consumer credit in Nigeria rose by N740 billion between January and September 2023.
Quoted in the story was a CBN report which stated that by September 2023, consumer credit in Nigeria had hit N3.05 trillion, an increase of 17% from Q2 2023. According to the CBN report, 74.8% of consumer credits, or N2.28 billion were personal loans, while retail loans made up the remaining 25.2%, or N766.97 billion.
According to the report, Other Depository Corporations (ODCs) contributed about 7.8% of consumer credit in Q3 2023. Based on the sectoral distinction, these ODCs constitute mostly of Fintech lending startups, microfinance banks, and players in the alternative lending market, among others.
The operational framework of Access Holdings’ Oxygen X remains undisclosed at present. Nevertheless, existing digital lending startups and companies in Nigeria serve as exemplars, offering a model for prospective entrants into the industry.
Also, the proposed entry of the banking giant into the consumer lending ecosystem brings it under the purview of a not-so-familiar regulatory body, the Federal Competition & Consumer Protection Commission (FCCPC).
Due to a spate of loan app harassment in the past, the FCCPC stepped in as a significant regulatory body to monitor the consumer lending industry, however, the agency has been vocal about its constitutional limitations to step into matters relating to the banking sector
