Shift to digital financial services’ll encourage competition, attract more Fintech – CBN

The Governor, Central Bank of Nigeria (CBN), Godwin Emefiele, has said that the accelerated shift towards digital financial services will attract more fintech investment and encourage competition to traditional financial institutions.

Emefiele made the statement in Enugu while delivering a keynote address at the seminar organized by CBN for financial journalists and business editors with the theme”Trends In Nigerian Payments System: Regulating the Fintech Digital Playing Field.”

Emefiele said that the advent of digital financial services, has created faster, more efficient, and typically cheaper transactions compared to traditional financial services.

Emefiele who was represented by Deputy Governor, Corporate Services, CBN, Mr Lametek Edward Adamu said from all indications, digital revolution will be a focus for financial institutions in the months ahead therefore making Fintechs a major driver of the industry.

Emefiele calls for an increased and intensive regulatory scrutiny on the part of regulators to proactively monitor developments and ensure the continuous safety and soundness of the financial ecosystem.

He said it is imperative that regulators must keep pace with these exponential developments and leverage new knowledge and technology tools such as Regtech and Suptech to enhance the efficiency and effectiveness of their mandate.

He said that studies have already shown that only one percent of FinTechs have been critically affected by COVID-19 and two percent severely affected.

By comparison, around 17 per cent of other high-growth companies fall into these categories, he said it is therefore unsurprising that many Fintechs have experienced a surge in demand as working practices and customer banking habits changed.

“As a country with one of the largest millennial population in the world- an estimated 62 per cent of the Nigerian population below 25 years of age, fast Smartphone growth driven by increasing affordability, Increasing mobile penetration and fast transition to 5G technology, Nigeria remains primed to be an active playground for digital transformation and cannot afford to ignore the Fintech challenge,” he added.