Emomotimi Agama, the director general of the Nigeria Securities and Exchange Commission (SEC), has advocated for “smart regulation” to balance the fintech industry’s explosive expansion and the continent’s need for investor safety and market integrity.
During his speech at the Nigeria Fintech Week 2024, which had as its topic “Positioning Africa’s Fintech Ecosystem to Accelerate Inclusive Growth,” Agama stressed how fintech can drastically change the continent’s financial environment but also raised serious regulatory concerns.
Agama brought attention to the mounting worries about the improper use of investment data, the susceptibility of cyberattacks, and the emergence of unregulated fintech companies seeking public funds without the necessary monitoring.
He pointed out that these actions compromise the SEC’s duty to safeguard investors, leaving them vulnerable to deception.
The Necessity Of A Legal Structure
Agama outlined smart regulation as a flexible yet strict strategy that fosters innovation while guaranteeing that businesses adhere to necessary security, consumer protection, and market integrity standards. She emphasized the need for regulatory frameworks that guarantee fintech innovations are safe, sustainable, and advantageous.
According to Agama, the SEC has created the Regulatory Innovation Program, enabling fintech companies to test their business plans safely before starting large-scale operations.
This program and the Accelerated Regulatory Innovation Program aim to make Nigeria the worldwide and African hub for fintech.
“These programs are essential to protect fintech entrepreneurs and create a stable, inclusive environment where innovation can flourish.
“The initiatives have already yielded tangible results, with several fintech firms receiving approvals and others in the pipeline undergoing thorough assessment.
“Trust is the cornerstone of any financial system. Smart regulation builds trust by ensuring that fintech companies operate transparently, protecting both investors and consumers,” he stated.
Fintech’s Contribution To Inclusive Growth
Agama exhorted fintech entrepreneurs to keep creating solutions that tackle Africa’s particular problems, especially those about financial inclusion, wealth development, and economic expansion.
Additionally, he urged governments to support fintech by launching projects like public-private partnerships, digital infrastructure development, and digital skill-building courses.
He observed that Nigeria is well-positioned to assist global fintech innovation by providing an enabling climate and unified regulatory frameworks that decrease barriers to entry and facilitate cross-border partnerships.
Agama emphasised the importance of cooperation between financiers, investors, academic institutions, civic society, and fintech innovators.
In order to guarantee that the advantages of fintech are generally recognized and available to everyone, he urged these organizations to collaborate to advance digital literacy and financial education.
Fintech Opportunities
Prior to this, Mr. Ade Bajomo, President of FintechNGR, stated that millions of individuals in Nigeria and Africa still do not have access to financial services, which presents a great opportunity for the fintech industry to expand.
“There are 40 million Nigerians and 350 million Africans still financially excluded. This provides chances for our ecosystem to leverage in order to achieve inclusive growth.”
“Though we are facing a period of investment drought and cost of living challenges, we must stay focused on our goals, for leveraging fintech as a tool for socio-economic development and exploiting every opportunity that innovation, technology, and leadership can deliver to improve our governance, processes, and scale,” Bajomo explained.
But he pointed out that enormous opportunity also carries great responsibility. According to him, Africa’s lack of proper infrastructure is now posing problems for fintech companies, including poor internet access, unstable power supplies, and talent scarcity.
According to Bajomo, the Nigeria Fintech Association will continue to foster connections, propel the industry’s expansion, and support fintech.
He went on to say that the association would also continue to strengthen its ties with regulators to jointly create regulations and aggressively solve problems that affect the fintech ecosystem.
What To Note
Every year, Nigeria Fintech Week brings together participants from various industries, including financial institutions, technology companies, regulators, investors, and industry experts.
It gives the stakeholders a forum to critically evaluate the situation of fintech in Africa and map out a progressive course for the future.
