NDIC, others partner to supervise fintech

The Managing Director and Chief Executive of the Nigerian Deposit Insurance Corporation (NDIC), Mr. Ibrahim Umaru, said the corporation has partnered with key financial and telecommunication agencies to produce a policy guideline for the registration, licensing and supervision of financial technology outlets.

Umaru who disclosed this at a workshop for the Financial Correspondents Association of Nigeria (FICAN), said the sector can help revolutionize the financial industry and achieve the financial inclusion goal.

The partnering agencies are the Central Bank of Nigeria (CBN), the Securities and Exchange Commission (SEC) and the Nigerian Communications Commission (NCC).

He said: “It can revolutionise the entire landscape; the banks see it as competition in some kind of distraction but at the same time most smart banks have embraced them – some of them are having subsidiaries of fintech and some are in partnership with fintech so that we can broaden the scope of intermediation.

“We are all for innovation, we are for disruption so long they enhance the productivity of our financial services sector, but we are also mindful of the need like I said to protect depositors. Should there be any challenge, they know where to go to and who to complain to and if they are thinking of complaining they can complain to CBN, SEC, NCC and to NDIC.”

The NDIC MD further said managing financial system risks requires collaboration, adding that financial system instability increases the volatility of asset prices and investor behaviour, leading to deteriorating credit conditions, increased costs to firms and households and potentially the collapse of the payment system.

“In Nigeria for instance, the Central Bank recently released a draft framework for regulatory sandbox operations to encourage innovation, especially for start-ups,” he explained.