CBN moves to review licensing framework for fintech
By Felicia Nwosu
In a bid to promote its standards of practice for individuals to function within the scope of operational ethical codes and to exercise the level of diligence, skill, and care as stipulated in the code of practice, the Central Bank of Nigeria (CBN) has revealed its intention to review its licensing framework for payment services.
This was disclosed by Olayemi Cardoso, the CBN Governor at the Chartered Institute of Bankers of Nigeria’s annual dinner in Lagos, where stated that this would lead to the development of a new regulatory and compliance framework for the payment service sector.
The bankers’ bank boss noted that irrespective of the immense role played by technological adoption and innovation, there is a need for reforms that would curb several financial and social menaces.
Recall that 3 years ago, the financial regulator approved new licence categorisations for the payments system through a circular dated December 9, 2020.
“Technology will continue to play a critical role in delivering financial services and enhancing financial inclusion. However, recent developments in the payment services landscape have raised concerns regarding the use of technology and the existing licensing and regulatory framework.”
The CBN Governor expressed concern over the presence of licensees operating outside the approved activities, breaching the boundaries set for them, reaffirming that any intentional or unintended non-compliance will be subject to sanctions, as operators have the responsibility to
“Concurrently, as we conduct a comprehensive review of the licensing framework for payment services, we will engage in extensive consultations to develop a new regulatory and compliance framework that is suitable for the technology-driven payment services sector.”
He elaborated some of the models within its purview which operators can authoritatively engaged their business transaction without breaking the law.
Cardoso further highlighted that fintechs had a role to play in helping Nigeria achieve its GDP target of $1tn and improving its capital inflows.
The bank of last resort said currently, payment service providers can operate with a Payment Service Provider License, Payment Terminal Service Provider License, Mobile Money Operator License, Switching and Processing License, or a Payment Solution Service Provider License.
It streamlined activities permissible under payments system licensing to switching and processing, mobile money operations, payment solution services, and regulatory sandbox.
RECOMMENDED ARTICLES
Comment
No comments found.