By Zainab Iwayemi
- Ecobank CEO charges Fintech community to attract savings
Musa Jimoh Itopa, director, payment system management, at the Central Bank of Nigeria (CBN), has said that social distance from object and persons has pushed the growth of the financial technology (Fintech) space by 800 per cent during the pandemic. He said this during a panel session at a virtual conference tagged, ‘Fintech Nigeria: The State of Play’.
The CBN director said the covid-19 pandemic has served as an eye-opener to so many in terms of payment.
“Globally, because of COVID-19, people were scared of touching physical objects, including cash, so there were lots of activities around Unstructured Supplementary Service Data (USSD), Internet banking, among others,” said Itopa.
He emphasized that the pandemic period awakened the consciousness of operators, service providers, among others in ensuring that their back-up facilities are in check so as not to be caught unawares, adding that it was an opportunity for operators to have a plan geared towards business continuity in order to ascertain the resilience of their services, while stating that parts of the lessons from the crisis were that technology created lots of opportunities to explore beyond, as there was low activities from banks’ physical branches.
According to Itopa, regulation of the Fintech industry will come when time is due. “Regulation is driven by innovation. The payment system will be driven by innovation. As innovation comes, the apex bank studies and provides required regulations and policy. There was an opportunity to leverage Artificial Intelligence (AI), Big Data, Bitcoin, among others,” he explained.
Also at the virtual event monitored by Business A.M, Patrick Akinwuntan, chief executive officer of Ecobank, noted that the financial technology payment space in Nigeria grew by about 800 per cent despite the pandemic; and further revealed that the Fintechs in collaboration with government agencies trusted in digital payment during the COVID-19 lock-downs, which prevented people from moving from one place to another.
“As much as we saw the impact of the Fintech community in payment, the biggest opportunity across all divides will come from savings, because a larger proportion of the populace, especially in the informal sector, earns income daily. They are not salaried earners. There is a need for the Fintech community to improve and attract savings. There must be a financial solution; Fintechs are at best ‘co-repetition’ and not a competition with the banks,” he said.
The bank chief further noted, while calling for the proper regulation of the industry, that the Fintech space has been most active with payment, and stressed the need for participation in savings and lending. “With a population of over 200 million people in Nigeria, the market only awaits collaboration among the Fintech players,” said Akinwuntan.
Further highlighting hindrances in the industry, Usoro Usoro, general manager, mobile financial services, MTN Nigeria, said the major challenge facing the industry from moving rapidly with innovation is regulation.
Usoro further identified some of the challenges faced by customers to include identity (KYC), distributions, and an environment conducive for services to thrive, noting that the Fintech space needs clarity around regulation.
There is an on-going consultation between the banks and the operators to reach a compromise on fees to be charged for such services, Usoro said, and disclosed that for a year, the banks and telcos have not added any charges on the service.
Meanwhile, Ngozi Megwa, senior vice president, digital partnerships, Middle East and Africa, at MasterCard, contributing at the virtual conference, said MasterCard is playing a huge role in the Fintech space. She also disclosed that the company has partnered with players in the Fintech industry including Samsung, Airtel and innovectives.
Megwa further asserted that Sandbox is encouraging Fintech and market organisers to want to partner with stakeholders to bring the right technology, and infrastructure to support either the banks or the Fintechs. In her words, “MasterCard sees digital commerce accelerating at a humongous rate.”