Who regulates fintech in Nigeria?

Nigeria’s fintech scene is booming, offering innovative financial solutions and changing the way people manage their money.

But with this growth comes the need for clear regulations to ensure consumer protection and financial stability.

Understanding who regulates fintech in Nigeria is very important for both businesses and individuals exploring this incredible industry.

Meet the Regulators:

Nigeria’s fintech ecosystem is regulated by a multi-pronged approach, involving several key players:

  • Central Bank of Nigeria (CBN): The primary regulator for financial services, the CBN issues licenses to fintech companies offering payment services, mobile money, and other financial activities. They also set guidelines for consumer protection, data security, and operational standards.
  • Securities and Exchange Commission (SEC): Regulates the capital markets, overseeing fintech companies involved in crowdfunding, investment platforms, and other securities-related activities.
  • Nigerian Communications Commission (NCC): Regulates mobile phone services, impacting fintech companies that rely on mobile networks for their operations.
  • National Information Technology Development Agency (NITDA): Oversees data protection and technology standards, ensuring fintech companies comply with regulations regarding data privacy and security.
  • Other relevant agencies: Depending on the specific fintech activity, other bodies like the National Insurance Commission (NAICOM) or the Federal Competition and Consumer Protection Commission (FCCPC) may also play a role.

What is fintech in Nigeria?

What is fintech in Nigeria?

The term “Fintech” refers to financial technology, which is an industry that includes all forms of technology used to deliver financial services to businesses and households.

Who regulates fintech in Nigeria?

Who regulates fintech in Nigeria?

The Central Bank of Nigeria is the primary supervisor that Fintech industry in Nigeria, but they are not the only body, they supervises the following categories of financial institutions in Nigeria:

  1. Bureaux-de-Change (BDCs)
  2. Commercial Banks
  3. Development Finance Institutions (DFI’s)
  4. Discount Houses
  5. Finance Companies (FCs)
  6. Holding Company (HCs)
  7. Merchant Banks
  8. Micro-finance Banks (MFBs)
  9. Non-Interest Banks
  10. Primary Mortgage Banks (PMBs)
  11. Payment Service Banks (PSBs)
  12. Mobile Money Operators (MMOs)

What are the laws regulating tech companies in Nigeria?

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NITDA is the regulatory body empowered by the National Information Technology Development Agency (NITDA) Act, 2007 to regulate and promote the use and development of Information Technology (IT) in all spheres of Nigeria through the development of IT framework, standards, guidelines, regulations, and policies.

Are Fintechs regulated by CBN?

Fintech companies offering financial services to Nigerian consumers must obtain the appropriate licences and comply with CBN’s applicable guidelines. The NDIC: The NDIC is responsible for insuring all deposit liabilities of licensed banks and other deposit-receiving financial institutions in Nigeria.

How much is CBN license fee for Fintech?

The application fee is a non-refundable fee of ₦100,000 (One Hundred thousand Naira), which is payable to the CBN via the LIcensing Fee for Payment Products Account No. NGN140230089/ABJ. Also, licensing fee of ₦1,000,000 (One Million Naira) to be paid before the issuance of the final license, if successful.

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How can I get fintech license in Nigeria?

To obtain a PSB licence in Nigeria, startups must:

  1. Submit an application to the CBN with a proposed Memorandum of Association and the proposed name of the company.
  2. Pay an application fee of ₦500,000.
  3. After the CBN receives the application within 90 days, the CBN would either approve or disapprove of the application.

What is fintech compliance?

FinTech compliance refers to the processes and procedures FinTech companies implement to follow industry regulations, standards, and laws. It includes critical elements like anti-money laundering (AML), fraud prevention, and know your customer (KYC) procedures.

How much do I need to start a fintech in Nigeria?

100,000 naira

Once there is a clear understanding of the regulatory terrain, the next step is to incorporate the company for the FinTech service. Although the minimum share capital for incorporating a private company in Nigeria is 100,000 naira, the share capital requirement for FinTechs usually exceeds this amount.

How profitable is fintech in Nigeria?

The largest market will be Digital Investment with a AUM of US$70.50m in 2024. The average AUM per user in the Digital Assets market is projected to amount to US$11.61 in 2024. The Digital Assets market is expected to show a revenue growth of 26.50% in 2025.

Are Fintechs regulated in Nigeria?

Fintech companies offering financial services to Nigerian consumers must obtain the appropriate licences and comply with CBN’s applicable guidelines. The NDIC: The NDIC is responsible for insuring all deposit liabilities of licensed banks and other deposit-receiving financial institutions in Nigeria.

Do Fintechs need to be regulated?

One of the main regulatory challenges for fintechs is compliance with KYC (Know Your Customer) and AML (Anti-Money Laundering) regulations. Fintechs are required to comply with these regulations in order to prevent money laundering and terrorist financing.

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What is fintech KYC?

What is a KYC solution in fintech? KYC solutions allow fintech companies to comply with applicable regulations and minimize the level of criminal activity. KYC includes customer identification, identity verification, risk scoring, and ongoing monitoring.

Richard okechukwu Chinedu

FinTech enthusiast with a passion for making financial technology accessible and understandable. I break down complex concepts into actionable insights to empower readers to navigate the ever-evolving world of FinTech.

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