NDIC MD Urges Banks & Fintechs To Drive Nigeria’s $1 Trillion Economy Goal

Mr. Bello Hassan, Managing Director and Chief Executive Officer of the Nigeria Deposit Insurance Corporation (NDIC), emphasized the critical role of banks and fintechs in achieving Nigeria’s ambitious target of a $1 trillion economy.

Delivering the keynote address at the 2024 Annual Conference of the Finance Correspondents Association of Nigeria (FICAN), Hassan highlighted the need for banks to mobilize financial resources from surplus units to productive sectors through financial intermediation and capital mobilization.

Key Takeaways from Hassan’s Address:

Banks’ Recapitalization_: The Central Bank of Nigeria’s (CBN) recapitalization initiative is essential for enhancing the resilience, solvency, and shock-absorbing capacity of banks

Fintechs’ Role_: Fintechs bridge the financial inclusion gap, but their rise also brings complexities in areas such as privacy, cybersecurity, and customer protection, requiring heightened regulatory oversight.

Regulatory Oversight_: Financial regulators like CBN and NDIC must foster a stable and sound banking system supporting productive sectors.

NDIC’s Commitment_: T)ahe NDIC remains committed to deposit insurance, bank supervision, and failure resolution, with initiatives to strengthen depositor confidence and ensure the safety of depositors’ funds.

Hassan encouraged stakeholders and finance correspondents to advocate for quality reportage on financial policies and initiatives, promoting a safe, sound, and stable financial services sector as Nigeria strives toward its $1 trillion economic goal.

 

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“Banks are pivotal in promoting growth through intermediation by mobilizing financial resources from surplus units to productive sectors. However, banks face risks that may not be accommodated by operational profits, making the Central Bank of Nigeria’s (CBN) recapitalization initiative essential for enhancing the resilience, solvency, and shock-absorbing capacity of our banks,” said Mr. Hassan. He added that recapitalized banks would be better positioned to guarantee depositor safety and serve as key players in Africa and the global financial market.

Mr. Hassan also addressed the critical role fintechs play in bridging the financial inclusion gap, particularly for underserved communities and small and medium-sized enterprises (SMEs).

He noted that while fintechs provide innovative financial services that reduce bottlenecks associated with traditional banking, their rise also brings complexities in areas such as privacy, cybersecurity, and customer protection, which require heightened regulatory oversight.

“The opportunities for growth and benefits that the system stands to gain from fintechs must be accompanied by robust regulations to address emerging risks and challenges, especially in the areas of transparency, personal information protection, and cybersecurity,” he said.

Mr. Hassan emphasized the role of financial regulators, such as the CBN and NDIC, in fostering a stable and sound banking system that supports the productive sectors of the economy. He praised the CBN’s foreign exchange rate unification policy and banks’ recapitalization as key drivers of Nigeria’s economic growth, with the potential to promote foreign direct investment, increase investor confidence, and improve the country’s sovereign credit ratings.

“The NDIC remains committed to its mandate of deposit insurance, bank supervision, and failure resolution. Our initiatives, such as the review of deposit insurance coverage and the introduction of risk-sensitive premiums for banks, are designed to strengthen depositor confidence and ensure the safety of depositors’ funds,” he added.

In his closing remarks, Mr. Hassan urged stakeholders and finance correspondents to continue advocating for quality reportage on financial policies and initiatives. He encouraged participants to engage actively in the conference discussions and to offer recommendations that would help the financial services sector remain safe, sound, and stable, as Nigeria strives toward its $1 trillion economic goal.

The conference, which gathered key players in the financial sector, provided an opportunity for in-depth discussions on the future of Nigeria’s economy, the role of banks, and the potential for fintechs to drive inclusive growth.
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