As the Nigerian fintech scene becomes increasingly widespread, and the country’s financial system relies more and more on fintech platforms, the nation’s central bank is putting forward new licensing agreements for experts in the field.
The rise of fintech firms “accentuates the known risks within the financial system,” said the Central Bank of Africa (CBA) in a draft policy document.
Confronted with cyber security risks, capital adequacy and operational oversight, the central lender is proposing a new licensing regulation for all fintech companies and payment service providers.
According to the suggested regime, there will be three types of license – basic, standard and super – all of which will endow firms the possibility to perform various activities.
However, the licensing may prove to be an obstacle for small start-ups, as the fee for a basic license requires a minimum of $275,000 in shareholder funds, with the super license demanding a whopping near-to $14 million.
When compared to other African nations, Nigeria is lacking in the fintech space, particularly with regards to mobile payments. In an attempt to catch up to its neighbouring countries, the West African republic has enabled telcos to apply for payment service banking licenses.
Despite recent court battles with the Central Bank of Nigeria over accusations that the firm exhausted the country’s forex reserves, South-Africa based MTN is one of the companies that has already announced plans to register for the license.