Nigeria’s mixed signals on fintech
Planned changes to the country’s fintech licensing regime could halt the growth of a burgeoning market.
The Central Bank of Nigeria's headquarters in Abuja
Financial technology looked set to take off in Nigeria.
Earlier this year, the country’s central bank and the Nigeria Inter-Bank Settlement System opened a regulatory sandbox to enable budding fintech companies to develop new products freely and securely, becoming one of the first African countries to do so.
Even before that launch, Nigeria was frequently touted as the continent’s next big fintech hub, set to compete with South Africa and Kenya.
Bitcoin exchange NairaEx, online lender KiaKia and invoicing platform Payant are just three of the firms that have made a name for themselves in short order.
“Fintech is revolutionizing Nigeria’s financial services industry,” PwC wrote in a report last year, citing its population’s great youth – half will be under 25 by the end of the decade – and mobile usage – 82% of web traffic takes place on mobile phones – as driving the increasing influence of new technology on banking practices.
Now regulators look to be adopting a different attitude to the sector.
In a draft policy document, Nigeria’s central bank has proposed new licensing rules for fintech firms.