The Governor of the Central Bank of Nigeria (CBN), Mr. Olayemi Cardoso, has called on monetary authorities in the West African Sub-region to unite against money laundering.
In an address at the 10th meeting of the College of Supervisors for Non-Bank Financial Institutions (CSNBFI) in the West African Monetary Zone (WAMZ), held in Abuja, Cardoso highlighted the growing trends in the Fintech space and its risks to financial stability globally.
Represented by the Acting Director, Other Financial Institutions Department, Mr. Abayomi Arogundade, Cardoso emphasized the need to strengthen anti-money laundering practices, deepen supervisory capacity on cybersecurity and Fintech regulation, and implement a risk-based supervisory approach.
He reiterated the importance of monitoring trends, risks, and innovations of NBFIs/OFIs, as their increasing transaction volumes pose major financial system stability risks.
Cardoso also addressed the issue of Fintech loans, noting that while they may appear small in relation to the size of credit by Deposit Monetary Banks (DMBs), some jurisdictions globally have observed a growing trend in the volume of these loans.
He explained that in many cases, Fintech credit is provided via electronic platforms that connect lenders to borrowers, with the platform taking the role of a financial auxiliary. However, in some cases, loans are taken on the balance sheet of these platforms, making them akin to new types of financial intermediaries.
The CBN boss urged greater cooperation among regulatory bodies in the sub-region to address cases of exploiting innovations in the industry to harm members of the public and institutions.
He also mentioned that in many jurisdictions, digital firms had banking licenses and were subject to prudential requirements, while others were regulated as Fintech payment service firms.
