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By Merit Ibe
Fintech adoption is relevant for the growth of Small and Medium Enterprises (SMEs), as it will address most of the problems small businesses encounter, especially in their relationship with traditional banking system.
Founder and Chief Consultant, B Adedipe Associates Limited, Biodun Adedipe, made the remark at the Nigeria SMEs Confab 2024 in Lagos recently, organised by Supernews with the theme: “Bringing SMEs into the Financial Services Network via Fintech”.
Adedipe explained that fintech has evolved to deal with the long list of deficiencies by introducing into the financial landscape the SME banking software. Re-echoing the description that fintech is the fusion of finance and technology, which has revolutionised the way we manage, invest and access money, he reiterated that its adoption would grow SMEs significantly.
He said SME banking is on the throes of fintech, adding that “SME banking is a set of financial services custom-fitted for the smaller scale and specific needs of Small and Medium sized Enterprises.”
Adedipe underlined that to make the Fintech fitted, it would require the government and the financial system regulators to treat fintech “as an important strategic part of the financial ecosystem not just to deepen financial inclusion, but to assure inclusive and sustainable economic growth.” While emphasising shared responsibilities, the financial expert said: “It is also important to mention that fintech operators should also maintain good faith, as the MSMEs grow with them.”
Citing Remita on how fintech could raise the contributions of SMEs he said: “As Nigeria continues to embrace digital transformation and foster innovation in the financial sector, the role of fintech in empowering SMEs will only grow in significance. With a young and dynamic entrepreneurial ecosystem, the demand for fintech solutions tailored for SMEs is expected to soar, driving further innovation and competition in the market.” Adedipe noted that MSMEs are pivotal to sustainable and inclusive economies, not only through job creation but also innovation sparks.
Also, the Director General, Small and Medium Enterprises Development Agency of Nigeria (SMEDAN) , Mr Charles Odii, stated that Fintech is one of the fastest-growing areas for venture capitalists that can benefit SMEs.
Represented by Zonal Coordinator, South-West of SMEDAN, Mr Olukayode Shode, the DG noted that bringing SMEs into the Financial Services Network via Fintech will enhance efficiency, accessibility and security with innovative solutions.
“The symbiotic relationship between finance and technology is reshaping the way banks operate and interact with their customers.The growing importance of fintech is its ability to streamline processes and reduce operational costs. Fintech solutions, such as mobile banking apps and digital wallets, provide convenient access to financial services irrespective of location or credit history.”
“This inclusivity not only empowers individuals but also fuels economic growth by bringing previously marginalized populations into the formal financial system.”
However, the SMEDAN boss pointed out that while Fintech funding is on the rise, regulatory problems exist.
“ While fintech firms create new opportunities and capabilities for consumers especially SMEs, they are also
creating new risks to be aware of. Data privacy and regulatory arbitrage are the main concerns.”
In her address, Publisher, Super News Nigeria, Ngozi Onyeakusi, said the choice of the theme was borne out of the quest to improve the business climate for SMEs in Nigeria by leveraging on technology in terms of accessing financial services.
“It’s unfortunate that SMEs that form the bedrock of every economy are plagued by a lot of challenges, especially inadequate access to finance.
“Indeed, reports have shown that the challenge of SMEs in accessing funds could be traced to inadequate access to financial institutions and education, skills, experience of owners/managers, high interest rates, gender discrimination, among others.
“It therefore becomes imperative to leverage on technology to ensure their sustainability, productivity and profitability.
“The confab is a learning opportunity designed to enhance awareness, deepen understanding of the participants on how SMEs can grow and sustain their businesses by embracing various financial services options including banking, capital market, pension and insurance.”
