Customers’ deposits with fintech firms to be insured – NDIC

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The Nigeria Deposit Insurance Corporation (NDIC) is fine-tuning its current regulatory framework towards protecting depositors from dangers that could arise from several emerging fintech solutions in the country.

The Managing Director, NDIC, Mr. Umaru Ibrahim, made this disclosure while delivering a speech at the just concluded opening ceremony of a workshop for members of the Finance Correspondents Association of Nigeria (FICAN) in Kaduna, themed “COVID-19 & FinTech Disruption: Opportunities and Challenges for Banking System Stability and Deposit Insurance.”

According to him, “The emergence of fintechs is relatively new in this environment and the Central Bank of Nigeria has produced a policy guideline for the registration, licensing, and supervision of fintechs.

“We are also involved in that and we partner with other regulatory authorities such as the Securities and Exchange Commission and well the NCC. That is because each and every one of us has a role to play in the licensing, supervision, and regulation of fintechs.

“We would continue to develop and improve your knowledge and skills so that you are up to date on what is happening globally and locally in terms of the financial system, so that you can help disseminate information and educate the generality of the public and so that the public remains aware and protected.”

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Speaking further, the NDIC boss said, “There are a lot of issues around consumer protections, even without the emergence of complicated products and services and channels of financial intermediation, such as biotech, even to day-to-day ordinary transactions between customers and banks.”

According to him, there is a need to protect the deposits of the customers to build confidence in the sector, and make for the financial stability of the industry.


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What you should to know

Fintech firms are considered to be small-medium retail operations set up with the purpose of competing against other larger and more established banking/financial institutions.

(READ MORE: Jack Ma’s fintech firm is set for IPO, signaling prospects for Nigerian fintech)

According to Mckinsey, Nigeria is now home to over 200 fintech standalone companies, plus a number of fintech solutions offered by banks and mobile network operators as part of their product portfolio.

They are currently taking opportunities and leveraging tech to tackle financial problems in the Nigerian society. They can be clearly divided into payments, Asset/WealthTech, CreditTech, InsureTech, Crypto, Personal Finance, etc.

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