Nigeria’s House of Representatives is considering a bill to establish the Nigerian Fintech Regulatory Commission (NFRC) — a new agency that would serve as the single authority to license and oversee all fintech activities in the country.
Why it matters:
The move aims to simplify Nigeria’s complex fintech regulatory environment, which is currently split among multiple agencies — including the Central Bank of Nigeria (CBN), Securities and Exchange Commission (SEC), National Information Technology Development Agency (NITDA), and Nigeria Deposit Insurance Corporation (NDIC).
For years, fintech operators have complained about overlapping mandates and conflicting directives from these regulators, creating uncertainty and slowing growth in one of Africa’s largest fintech markets.
How it works:
According to a draft bill, the NFRC will:
- Issue individual or class licences depending on fintech activities — such as payments, lending, crypto, crowdfunding, or regtech.
- Impose stricter compliance requirements, including a dedicated compliance unit, legal counsel, periodic tech audits, and proof of Nigerian ownership or management participation.
- Set operational standards, covering data protection, consumer rights, service quality, and dispute resolution mechanisms.
Between the lines
The bill significantly raises compliance costs. Startups may need to budget for legal and regulatory expertise from inception, while larger fintechs will have to align existing systems with NFRC requirements.
Consumer protection angle
The NFRC would be empowered to curb anti-competitive practices such as price-fixing, collusion, and market dominance abuse. It would also have authority to rein in predatory loan recovery tactics — a long-standing issue in Nigeria’s digital lending space.
The big picture
By creating a single regulator, the NFRC could enhance interoperability and open banking, helping smaller fintechs access payment and data infrastructure.
It also introduces local content provisions, requiring fintechs — especially foreign-backed ones — to include Nigerian participation in ownership and management.
What’s next
If passed, the NFRC could become one of Nigeria’s most powerful financial regulators, reshaping how fintechs operate, compete, and innovate in the country’s $1 billion digital finance industry.
Source: TechCabal
