Emefiele insists on increased oversight of digital payment system
• Insists that enaira will not fuel inflation
Eromosele Abiodun, James Emejo and Nume Ekeghe in Enugu
Central Bank of Nigeria (CBN) Governor Godwin Emefiele yesterday stressed the need for increased regulatory oversight to proactively monitor developments in electronic and digital payment systems amid the impact growing financial technology companies (Fintechs).
He said regulators must also ensure the continued safety and soundness of the financial ecosystem.
Indeed, the bank also clarified that contrary to speculation, the planned unveiling of the central bank’s digital currency (CBDC) also known as eNaira, would not exacerbate inflationary pressure on the economy.
Emefiele said in a speech to Enugu State, while also declaring open the 31st CBN Seminar for Financial Correspondents and Editors, on the theme: “Trends in the Nigerian Payment System: Regulating the Fintech digital playground ”.
Represented by the Deputy Governor of the CBN, Directorate of Business Services, Mr. Edward Lamekek Adamu, the Governor of the CBN noted that discussions had intensified around the issue of the digital economy as more and more more opportunities have presented themselves to financial institutions and other players in the payments ecosystem to innovate and deliver more efficient services. payment and settlement options.
He said, however, that regulators need to keep pace with these exponential developments in the digital financial landscape and take advantage of new knowledge tools and technologies to improve the efficiency and effectiveness of their mandate.
He stressed that by all indications, the digital revolution will remain a priority for financial institutions in the months to come, thus making Fintechs a major driver of the industry.
According to him, “As the global economy recovers from COVID-19, it is evident that Fintech will play a greater role in a resilient and sustainable recovery.
“Studies have already shown that only 1% of Fintechs have been severely affected by COVID-19 and 2% severely affected. In comparison, about 17% of other high growth companies fall into these categories. “
He added: “It is therefore not surprising that many fintechs have seen an increase in demand as the working practices and banking habits of customers have changed.”
Emefiele further pointed out that eNaira would help CBN achieve its goals of fostering greater inclusion using digital channels, supporting cross-border payments for businesses and providing a reliable channel for remittances in the country.
He said that with the deployment of eNaira, Nigerians in remote areas would conduct financial activities using their digital as well as functionality on phone devices.
He said: “In partnership with our financial sector stakeholders, I believe more Nigerians will be included financially. “
He said the eNaira, which is expected to launch in a few days, would make Nigeria one of the first countries in Africa, and indeed the world, to embrace the digitalization of its national currency.
He said that any country’s payment system plays a central role in its economy, being the channel through which financial resources flow from one segment of the economy to another.
However, Mr. Hassan Mahmud, Director of the Monetary Policy Department of the CBN, in his presentation on “Implications and Trends of the Digital Financial Ecosystem for the Implementation of Monetary Policy”, said the impact eNaira on inflation remained zero for the time being.
Additionally, during a panel discussion on “Creating a Secure Cyber Environment for Financial Transactions”, panelists agreed that protecting end-users of financial technology is paramount.
They also insisted on the need for good consumer awareness in order to minimize the level of fraudulent transactions, which had cost banks and individuals a fortune.
CBN Deputy Director, Payment Management System,
Rakiya Yusuf, said that every stakeholder, including consumers, has a responsibility to protect electronic payment systems from any form of compromise.
The chairman of the Chartered Institute of Bankers of Nigeria (CIBN), Abuja branch, Professor Uche Uwaleke, said dispute resolution should be given special attention in digital transactions.
Interswitch’s Akeem Lawal also said protecting clients was paramount, adding that the focus should be on how to help clients recover funds in the event of theft.
He said to ensure the security of the digital ecosystem; CBN guidelines on payment systems should be taken seriously.
On a related note, Accelerex Chief Product Officer Mr. Chuks Anakudo said that as much as it is the responsibility of service providers to ensure the safety of consumers, end users should also have a responsibility to protect their sensitive information from fraudsters and the public.