“NIGERIA’S FINTECH SECTOR SPLITS OVER REGULATORY CHALLENGES – SURVEY REVEALS”

“NIGERIA’S FINTECH SECTOR SPLITS OVER REGULATORY CHALLENGES – SURVEY REVEALS”



Nigeria’s fintech sector is split over the country’s regulatory framework, with half of operators describing it as supportive of innovation and the other half viewing it as restrictive, according to a recent survey of the industry.

The findings draw from a nationwide ecosystem survey, a stakeholder workshop, and a fintech roundtable conducted in 2025. The division reflects ongoing concerns over licensing delays, unclear guidance, and inconsistent enforcement across regulatory agencies, despite improved engagement between regulators and fintech operators.

“Exactly half of respondents view the regulatory environment as enabling, while the other 50 per cent find it restrictive. This divergence stems from perceived delays in licensing, lack of clarity in guidance, and inconsistent application of rules,” the survey noted.

Regulatory Challenges and Costs

Regulatory processes are slowing innovation, with 62.5 per cent of firms reporting approval delays that materially affect product launches. More than one-third of respondents said new products take over 12 months to reach the market due to compliance bottlenecks.

Compliance costs remain a major burden, with 87.5 per cent of fintechs stating that spending on regulatory and risk-management requirements limits their ability to innovate, particularly in areas such as anti-money laundering controls, cybersecurity, and fraud prevention.

While safeguards are necessary, fintech operators expressed concerns about fragmented supervision and duplicative reporting, which particularly affect smaller or fast-growing companies.

Structured Engagement Over Deregulation

Despite these challenges, fintech operators are calling for deeper engagement with regulators. About 75 per cent of respondents advocated for regular, structured engagement forums, while all firms surveyed expressed willingness to participate in regulatory sandboxes, policy pilots, or working groups.

Regional expansion remains a key growth ambition, with 62.5 per cent of firms already operating or planning to expand into other African markets. However, fragmented licensing across countries increases costs and slows expansion. Regulatory passporting, allowing Nigerian licences to be recognised in peer markets under agreed frameworks, was supported as a potential solution.

Technology, AI, and Risk Management

Fintechs praised Nigeria’s real-time payments infrastructure but noted gaps in digital identity verification, data-sharing systems, and broadband access. Peak periods in transaction volume also revealed stress points in service delivery.

On cryptocurrency, operators recommended risk-based regulation rather than blanket restrictions. Access to capital remains a challenge, with 37.5 per cent citing macroeconomic volatility, currency risk, and delays in foreign investment approvals.

Technology adoption is increasingly shaped by risk management needs. 87.5 per cent of fintechs now use AI for fraud detection, 62.5 per cent deploy AI-powered chatbots for customer service, and others apply AI to credit scoring, risk modelling, and customer onboarding.

Balancing Innovation and Oversight

The survey highlights the need to balance fintech innovation with prudent oversight. While innovation drives growth, maintaining strong governance, consumer protection, and effective risk management remains critical.

The findings indicate both progress and remaining challenges in Nigeria’s fintech ecosystem, with a clear industry appetite for responsible innovation, structured engagement, and growth-oriented policy frameworks.

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