Emefiele Laments Rise of Fintech Banking, Says It’s Disturbing

  • The Governor of the Central Bank of Nigeria (CBN), Godwin Emefiele, said the growth of the fintech ecosystem in Nigeria is challenging the traditional banking sector.
  • The CBN said the growth and challenges posed by fintech companies in Nigeria to commercial banks are worrying
  • According to him, the CBN has put in place mechanisms to ensure the growth and robust monitoring of the fintech ecosystem.

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Godwin Emefele, the Governor of the Central Bank of Nigeria (CBN), said the rapid growth in the development of fintech companies has continued to change the financial sector in Nigeria.

He said the growth has continued to disrupt traditional banking methods and offer financial services in the sector. Emefiele said the development is worrying.

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Emefiele, CBN, Fintech
Central Bank of Nigeria Governor Godwin Emefiele Credit: Bloomberg/Controbutor
Source: Getty Images

Products developed by fintechs challenge big banks

Emefiele said there is a need for the CBN and other regulatory agencies to put in place strong regulatory controls to help mitigate the tragic incident that may occur as the country enables fintech growth.

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He said the myriad of products developed by fintech companies, including digital payments, international remittances, mobile money, P2P and lending platforms, are challenging traditional banks in the country.

According to him, the apex bank has issued some policies and guidelines based on fintech and regulatory sandboxes, open banking and cybersecurity to ensure a strong regulatory landscape without killing innovation.

Minister of Finance, Budget and National Planning, Zainab Ahmed, challenged financial sector regulators, including the CBN and the Nigeria Deposit Insurance Corporation (NDIC), to upgrade their oversight tools to enable them to respond to potential fintech threats.

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This day reports that Emefiele and Ahmed were speaking at the opening of the Technical Assistance Workshop of the African Regional Committee of the International Association of Deposit Insurers in Abuja on Tuesday, October 4, 2022.

Efiele and Ahmed’s statements came as the World Bank said Monday, October 4, 2022 that Nigeria’s growth chances were being suppressed by its underperforming oil sector, creating fiscal inequality for the country.

The World Bank paints a grim picture of Nigeria

However, the World Bank applauded the CBN’s direct interventions in the agricultural and manufacturing sectors and said it provided assistance for private investment, which expanded economic activities.

The World Bank statement came after Nigeria National Petroleum Company Limited (NNPC) Group CEO Mele Kyari said Nigeria was in a state of misfortune due to oil theft, pipeline vandalism and Other Criminal Activities in the Niger Delta.

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Kuda Bank challenges the traditional banking system in Nigeria and has won so far

Remind that Legit.ng reported that, for the most part, Kuda Bank did not have a branch. This means he has no physical structures, nowhere to physically go and file complaints if something is wrong.

But that has not deterred Nigerians, especially young people, from opening an account with him.

At last count, the bank had more than 1.4 million customers since its inception in 2017, five years ago.

Source: Legit.ng

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