Is buy now, pay later safe? Eight checks before you sign up in Nigeria
BNPL is safe when the lender is registered, the cost is in writing and the plan fits a bad month. Eight checks, the FCCPC list, and what a late payment costs.
Buy now, pay later has gone from a novelty to a normal way to buy a phone or laptop in Nigeria. With that comes the question every student should ask before tapping confirm: is it safe?
The honest answer has three parts. The product is safe. Some of the companies offering it are not. And a plan that is safe for one person is a trap for another, depending on what else they already owe.
This article looks at what the evidence says about BNPL risk, what Nigerian law now requires of lenders, eight things to check before you sign up, and what actually happens if you miss a payment.
What the evidence says about the risk
The best data comes from countries where BNPL is older. In the United States, the Consumer Financial Protection Bureau found that 21.2% of consumers with a credit record had financed at least one purchase with BNPL, that 63% of borrowers held more than one BNPL loan at the same time at some point in the year, and that a third borrowed from more than one BNPL lender. Among 18 to 24 year olds, BNPL made up 28% of all unsecured debt, against 17% across all ages (CFPB, 2025).
In the UK, the Financial Conduct Authority found BNPL users are "on average, younger and less creditworthy, with higher levels of unsecured debt", and "almost twice as likely to be in serious financial distress compared to the wider UK population". It also found "some evidence that DPC borrowing modestly increases future DPC missed payments" (Chan et al., 2025).
Neither regulator concluded that BNPL is bad. Both found the same pattern: the risk is not one plan, it is several at once, taken by people who were already stretched. That is the thing to design your own use around.
What Nigerian law now requires of lenders
Nigeria tightened the rules in 2025. The FCCPC's Digital, Electronic, Online or Non-Traditional Consumer Lending Regulations took effect on 21 July 2025 (Obasi et al., 2025). A court challenge by an industry group was dismissed in full, and the Commission resumed enforcement in July 2026 (FCCPC, 2026b). The rules include an explicit ban on lenders accessing borrowers' contact lists, call logs and photos, with fines of up to ₦50 million for individuals and ₦100 million or 1% of turnover for companies (Nwokoma, 2025).
Enforcement is real. In January 2026, after a compliance deadline, more than 100 loan apps run by unregistered entities remained on the Commission's watchlist and conditional approvals were withdrawn from non-compliant operators (Ibeh, 2026). The Nigeria Data Protection Commission says it receives about three complaints a day about digital lenders alone, "almost 100 in a month" (Eleanya, 2025), and in 2024 it fined seven companies a total of ₦400 million, with around 400 of its cases involving digital lenders (Aimuengheuwa, 2024).
Consumer law adds two rights worth knowing. Under the Federal Competition and Consumer Protection Act 2018, terms must be in plain language an ordinary consumer can understand "without undue effort", and a business "shall not require a consumer to pay a price for any goods or services higher than the displayed price" (Federal Republic of Nigeria, 2018). The CBN's consumer protection rules for the institutions it supervises go further, requiring disclosure of the repayment schedule, early liquidation terms, the total cost of credit and any late payment fee (Investdata, 2019). That standard, every cost in writing before you agree, is the one to hold any lender to, bank or not.
Eight things to check before you sign up
- 1Is the lender on the FCCPC register? The Commission publishes approved, conditionally approved, watchlisted and delisted lenders. When we checked in October 2026 it listed 525 approved companies, 35 on conditional approval, 112 apps on the watchlist and 54 delisted (FCCPC, 2026a; Akintaro, 2026). If a name is on the watchlist or delisted, stop.
- 2Is the total cost on the screen before you agree? The deposit, the number of instalments, the amount of each, the interest rate, any fee for paying late, and what it all adds up to. "No hidden fees" is a claim. A written schedule is proof.
- 3What happens if you are late? A fee, a locked device, a report to the credit bureaus, a debit from your bank account? Each of these is legal when disclosed. Find the answer before you need it.
- 4What does the app ask permission for? Contacts, call logs and photos are now prohibited for lenders. An app that still asks is telling you what it plans to do with them.
- 5Does the instalment fit a bad month, not a good one? Price it after rent, food, data and transport. If one late allowance would break the plan, the plan is too big.
- 6Is it one plan, or one more plan? The evidence above is clear: trouble comes from stacking. Finish one before you start another.
- 7Is the device genuine and covered? Who sells it, is it sealed, does it carry the maker's warranty, and if it is refurbished, is the condition written down?
- 8Has anyone asked you to pay to be approved? A fee to process, activate, unlock or raise a limit is a scam, every time. The Central Bank of Nigeria's own warning is that it "does not demand payments or fees" and has appointed no agents to act for it (Tunji, 2025).
If you miss a payment: what can happen in Nigeria
| What | When it applies |
|---|---|
| A late payment fee | Where the terms say so. Ask for the amount in writing before you sign. |
| A lower score, and a report to the credit bureaus | CBN rules require loans to be reported to at least two bureaus, though many lenders don't (Abubakar, 2025). A default can stay on your file for years. |
| A debit from your other bank accounts | Bank loans only. Under the CBN's Global Standing Instruction, once you sign the mandate the bank can recover arrears from your accounts at other banks, matched by BVN, and the mandate "shall remain perpetually in place throughout the life of the loan" (Odutola, 2020; Ifeanyi, 2022). |
| A locked device | Some phone-financing providers say they can lock a financed device remotely. Look for that word in the terms. |
None of these are unfair when they are disclosed. What is unfair is finding out afterwards.
The fraud picture, and the pattern behind it
Digital payment fraud losses in Nigeria fell to ₦25.85 billion in 2025, 51% below the ₦52.26 billion lost in 2024, across 67,518 reported cases (Ajose, 2026; NIBSS, 2026). That is still ₦25 billion. Very little of it is a hacker breaking in. Most of it is someone who asked for a code, a PIN or a fee, and got it.
How Pody approaches it
We built Pody to pass its own checklist. Here is how it holds up against the eight points above.
- Every cost on the screen before you confirm. 20% today, the rest in daily, weekly or monthly instalments you choose at checkout, with 0% interest, no hidden fees and no markup. A late payment fee may apply, and our terms say so in advance. Read the terms.
- What we check, and what we don't. A government ID, a short liveness check, your address and your student status. No payslip, no guarantor and no credit history required.
- One plan at a time. You cannot stack plans on Pody. Finishing one re-rates your limit for the next.
- Repayments reported both ways. Positive and negative history goes to licensed credit bureaus under the Credit Reporting Act 2017, so paying on time builds something, and a default follows you.
- Your data, protected. Two-factor sign-in, cards tokenised so raw numbers are never stored, and any breach reported to the NDPC within 72 hours. A data protection officer you can write to at dpo@pody.network. See how we protect your data.
Buy now, pay later is not safe or unsafe on its own. It is as safe as the lender's honesty and your own arithmetic. Check both before you tap confirm.
If you want to see what a plan looks like before you commit to anything, see how Pody works.
Sources
- Abubakar, A. (2025, October 1). Nigeria's lenders have dodged credit bureau reporting for years; Lendsqr just made it free. TechCabal. Read the article
- Aimuengheuwa, J. (2024, June 12). NDPC imposes N400 million fines on seven firms for data breaches. Techeconomy. Read the article
- Ajose, T. (2026, January 22). Nigeria's digital payment fraud drops in 2025, NIBSS. News Central. Read the article
- Akintaro, S. (2026, September 9). Instant loans dry up as FCCPC rules force lenders toward safer borrowers. Nairametrics. Read the article
- Chan, E., de Mauro, A., Shaw, J., Hainsworth, S., Mitchell, M., Norrgren, H., Firth, C., & Sheth, J. D. (2025, July 18). Distress deferred? The impact of Buy Now Pay Later credit on consumer indebtedness and arrears (Occasional Paper 69). Financial Conduct Authority. Read the paper
- Consumer Financial Protection Bureau. (2025, January 13). CFPB research reveals heavy buy now, pay later use among borrowers with high credit balances and multiple pay-in-four loans. Read the release
- Eleanya, F. (2025, September 10). Three loan shark breaches a day: Inside Nigeria's busiest year of data enforcement. TechCabal. Read the article
- Federal Competition and Consumer Protection Commission. (2026a). Registration of digital money lenders. See the register
- Federal Competition and Consumer Protection Commission. (2026b, July 20). FCCPC resumes digital lending regulation. Read the notice
- Federal Republic of Nigeria. (2018). Federal Competition and Consumer Protection Act 2018, sections 114 and 115. Via LawGlobal Hub. Read the sections
- Ibeh, R. (2026, January 21). FCCPC moves against unregistered loan apps, revokes conditional approvals. BusinessDay. Read the article
- Ifeanyi, U. J. (2022, January 29). CBN to watchlist recalcitrant loan defaulters through the GSI. Nairametrics. Read the article
- Investdata. (2019, December 22). CBN to fine banks for non-resolution of customer complaints within set timelines. Read the article
- Nigeria Inter-Bank Settlement System. (2026, June 2). Digital payment fraud drops 51% to ₦25.85b in 2025. Read the release
- Nwokoma, C. (2025, August 20). What the FCCPC's digital lending regulations mean for lenders and borrowers. Techpoint Africa. Read the article
- Obasi, N., Okorji, E., & Isikaku, O. (2025, September 11). The FCCPC Digital, Electronic, Online or Non-Traditional Consumer Lending Regulations 2025. BusinessDay. Read the article
- Odutola, A. (2020, July 14). CBN asks banks to place chronic loan defaulters on watchlist from August. Nairametrics. Read the article
- Tunji, T. (2025, May 12). CBN warns Nigerians against fake contracts, grants, loans. Nairametrics. Read the article