The Central Bank of Nigeria has said that digital revolution will be the focus of financial institutions in the coming months, making Fintechs a major driver of the industry.
Speaking at the ongoing seminar for finance correspondents and business editors in Enugu state on Wednesday, Governor of the CBN, Godwin Emefiele, said technology continues to change the face of the financial services industry.
According to him, the advent of digital financial services, for example, has created faster, more efficient, and typically cheaper transactions compared to traditional financial services.
Represented by Edward Lametek, CBN Deputy Governor, he said over the past 14 years, the Nigerian payment system has evolved significantly with extensive technological development backed by deliberate enabling regulation by the CBN.
This he said, has accelerated the development of novel financial products, services, and channels all of which have placed Nigeria at the fore of the financial innovation race.
“As the global economy recovers from COVID-19, it is obvious that FinTech will play a more important role towards resilient and sustainable recovery,” he said.
He noted that the CBN Act 2007 empowers it to regulate the Payments System, while banks, the Nigeria Inter-Bank Settlement System, the Nigerian Exchange Group, payment service providers, and switching companies are the other major players in the system.
He said the CBN, complemented by the Nigeria Deposit Insurance Corporation provides the necessary oversight function to ensure the efficiency and effectiveness of the payments system
Emefiele noted that year 2007 marked a turning point in the country’s payments system terrain with the launch of the CBN’s Payment Systems Vision 2020, which identified series of recommendations to increase the resilience of the payment system infrastructure and work-streams to encourage the usage of electronic payment methods.
“Since then, the country has continued to introduce initiatives that would help simplify payments and deepen financial inclusion.
According to him, due to the lockdowns associated with the management of the Corona Virus (COVID-19) pandemic, financial traffic to digital platforms increased significantly in 2020.
“Indeed, the spread of the virus at the time accelerated the speed of digitalisation of many sectors of the economy. Expectedly, discussions have increased around the issue of the digital economy just as more opportunities have come up for financial institutions and other players within the payment ecosystem to innovate and provide more efficient options for payments and settlements,” Emefiele said.