By Chinenye Anuforo
The Nigerian Communications Commission (NCC) has said that fintech has the potential to deepen the existing payment and financial system infrastructure to reach unserved and underserved areas and further stimulate economic growth.
Dr. Aminu Maida, Executive Vice Chairman/CEO of the commission, stated this at the 2023 NITRA Financial Technology (Fintech) Forum last week in Lagos, with the theme “Harnessing Nigeria’s Fintech Potential: Challenges and Opportunities”.
The EVC, who was represented by Mr. Henry Ojiokpota, NCC Lagos zonal controller, explained that Fintech is gradually revolutionizing Nigeria’s financial ecosystem as it poses a great disruption to the conventional financial system. “As an emerging industry that leverages on technology to support several financial services such as mobile banking, borrowing, investment, cryptocurrency among others, Fintech comes with a lot of business opportunities in terms of innovation, job creation and investment. Therefore, Fintech has the potential to deepen the existing payment and financial system infrastructure to reach unserved and underserved areas and further stimulate economic growth”, he said.
He noted that Fintech applications such as robo-advisors, payment apps, peer-to-peer (P2P) lending apps, investment apps, and crypto apps, among others, create business opportunities for individuals. “With the youth population accounting for an estimated 70per cent of Nigeria’s population, the digitally savvy, young, and middle-aged individuals adopting these Fintech applications for socioeconomic gains will add value to the economy. Recent industry statitistics has shown that active subscriptions across mobile networks in Nigeria rose to 220.7 million in August 2023 (NCC).”
Continuing, he pointed out the increasing rate of smartphone penetration, internet access, and focused regulatory drive have continued to create a favourable atmosphere for Fintech to thrive. Furthermore, greater accessibility to customer, convenience, and low-cost access to short-term loans will further deepen the acceptability of Fintech products and services. “Records have shown that the Fintech sector has benefitted a lot from external investment, amounting to over US$I billion investment since 2018.
The National Financial Inclusion Steering Committee, which is a committee of stakeholders from the public and private sector, has been at the forefront of promoting inclusive growth and development through financial inclusion.
The Committee recognizes the place of innovative business models in achieving financial inclusion objectives and facilitating inclusive growth in the Nigerian economy. It is in light of this that the Committee developed the National Financial Inclusion Strategy policy document to fast track the growth and development of a Nigerian Fintech ecosystem that can favourably compete globally. This strategy provides the roadmap for unbundling several untapped potentials and benefits in the Fintech ecosystem.”
He noted that digital financial services will continue to have a significant impact on Nigeria’s financial inclusion and the digital economy at large. “This is because of the optimal utilization of digital technologies in the provision of financial services to rural communities and underserved segments of the population by leveraging on high mobile phone penetration in Nigeria. In a nutshell, such measures extend financial services coverage and create avenues for affordable solutions. Therefore, coming up with new digital financial business models and initiatives as well as huge investment in digital infrastructure and e-commerce that will open the market and further stimulate development in the Fintech sector.
He pledged that the NCC as the apex regulatory agency of the communications industry, will continue to support the Fintech sector in harnessing its enormous potentials as well as overcoming the challenges identified. “This can be achieved through adequate provision of secure infrastructure and USSD channels that enable delivery of Digital Financial Services delivery in efficient ways. The NCC is also keen on maintaining minimum standards Quality of Service (QOS), for an uninterrupted network that will boost the sector. In support of this objective, the Commission has
executed the Memorandum of Understanding with CBN on driving payment systems and financial inclusion, which is in line with the Nigeria Payments System Vision 2025. Furthermore, the Commission is playing an important role in harnessing the potentials of Fintech through maximum support for Fintech policies, enforcing regulations, and strengthening collaborations with relevant authorities such as the CBN and other stakeholders.” He added that the NCC is also promoting incubation and sound practices of Fintech firms and highly secured platforms to further enhance the development of the Fintech ecosystem as well as the digital economy space in general. “These measures would ultimately enable the attainment of the objectives of the Nigerian Startup Bill, particularly in the Financial Services sector, and maximize the benefits of Fintech while mitigating the risks involved”, he said.