Why Government should not regulate Financial Technology

Fri, Nov 9, 2018 | By publisher


Featured, Finance

Financial technology expert frowns at the attempt by the government to regulate the sector and stresses the need to use technology to improve banking services in Nigeria  

By Anayo Ezugwu

Aderemi Atanda, executive director, SystemSpecs Limited, and a Financial Technology, FinTech, expert, has said that technology is fast changing the face, pace and conduct of businesses across the world and Nigeria, particularly the banking sector.

Atanda said the advancement in instantaneous (do it yourself) banking services today were some sort of mirage few years ago. He said if properly utilised, technology will further change and shape banking services for the better. Therefore, he said collaboration among stakeholders will be key in positioning Nigeria as a reference point for FinTech in the global technology ecosystem.

Atanda, who spoke at the third edition of the Centre for Financial Journalism, CFJ, and the Association of Marketing Professionals in Nigerian Financial Institutions, ACAMB, business forum in Lagos, on November 3, said there are huge potentials in FinTech players who are currently developing technology solutions that are driving financial transactions in the financial service space.

He stressed the need for collaboration between FinTech and the banks to further meet the needs of financial services customers who are yearning for more solutions that would make them do more financial transactions, without visiting any of the bank branches. He said there are lots of untapped data about customers’ behaviour and spending habit that could be generated and analysed.

According to Atanda, such data can help the banks and other financial institutions make better policies that would enhance their business and offer full satisfaction to customers’ needs. “To achieve this, FinTech and banks must collaborate to further develop the Nigerian financial space that is currently doing over N80 trillion financial transactions on its e-payment platforms up from N4 trillion transactions it was operating on in the last three years,” he said.

Atanda explained that generating and analysing data about consumers’ behaviour, would allow the banks have enough information from data to mitigate financial risks. He said while the FinTechs provide the technology solution, the banks provide the financial services, and if there is committed collaboration and synergy, both parties could work together to provide customers the desired services that meet and surpass their expectations.

“We need more technology driven services that will address specific challenges, and deal with the risks of evolving technologies, rather than shying away from evolving technologies because of their minute negative effects on online transactions.”

He, however, frowned at any attempt by government to regulate the FinTech space. He noted that such attempt would rather stifle the growth of FinTech and limit them to the background. Government, he said, has no business in regulating evolving technology, but should provide the enabling environment for evolving technologies to thrive.

“FinTech is rapidly moving to bring transformative and disruptive innovation to financial services, through the application of new and emerging technologies which address consumer needs through automation. In the payments space, Nigeria has made remarkable progress in e-payment transactions. FinTech has blurred the lines between various financial services. The use of technology to provide consumer with more immediate solutions to their needs across different segments has set them apart from traditional solution providers,” he said.

On his part, Olufemi Awoyemi, managing director, Proshare Nigeria, said the banks must be proactive to address evolving challenges from technologies. He said the best way to address these challenges is to collaborate with FinTech players.

He said the world has developed to the extent of using generated data to create algorithm for analysing and developing information that would help financial institutions design policies that would help them manage their customers better.

In his welcome address, Ray Echebiri, chief executive officer, CFJ, advised participants to take maximum benefit of the wealth of experience of the seasoned professionals invited to the forum. He specially recognised untiring efforts of ACAMB executives for collaborating with CFJ to organise such an eye opening forum for efficiency and better service delivery to customers across board.

– Nov. 9, 2018 @ 17:19 GMT |

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