SEC: We’ll enforce fintech regulations to protect investors’ funds

The Securities and Exchange Commission (SEC) says it will enforce regulations in the financial technology (fintech) ecosystem to curb mismanagement of funds and align operators with existing rules.

Emomotimi Agama, director-general of SEC, spoke on Tuesday at the Nigeria Fintech Week on Tuesday

Agama said a regulatory environment that is conducive for the innovative use of technology is essential in the drive to transform Nigeria.

He also said it is time for fintech operators to be held to the rules of the capital market when it comes to fundraising.

“Smart (fintech) regulation serves as a catalyst for increasing growth by promoting transparency, protecting investors and ensuring financial stability in a rapidly evolving ecosystem,” Agama said.

“Fintech, particularly in Africa, offers transformative potential that addresses non-standard challenges such as financial inclusion, limited access to credit and the inefficiencies of traditional financial services.”

Agama also said regulation played a pivotal role in ensuring fintech solutions were safe, sustainable and beneficial for all youths.

“Smart regulation builds trust by ensuring that fintech companies operate transparently and that consumer rights are protected,” he said.

“For example, our regulations require all fintech companies dealing with digital assets, cryptocurrencies and other securities to adhere to robust anti-money laundering and new customer standards.

“This puts us in a safer environment for both investors and consumers.”

‘FINTECH IS A SOLUTION TO FINANCIAL ACCESS’

Agama also said fintech had emerged as a solution, offering services that were not only accessible but also cost-effective.

He added that according to the World Bank, a significant proportion of Africa’s population remained unsafe or completely unbanked, limiting their access to essential financial services.

“Determining what a more inclusive and African fintech ecosystem requires is a collaboration across all sectors,” he said.

He said beyond regulation, governments could promote fintech through initiatives such as digital infrastructure development and public-private sector partnerships.

Agama added that fintech could also be promoted through internal programmes to build digital skills in fintech.

On his part, Akin-Akintunde Ajayi, business development lead, MasterCard, said there was a need to improve the financial system to enable tailored solutions tailored to the global market.

He said that MasterCard believed in the future of digital payments in Africa and cooperation with fintechs.

“Fintechs have been at the forefront of creating local advanced solutions that resonated with Nigerians,” Ajayi said.

“By partnering with Fintech, we don’t just replace apps, we build energy systems that reflect the global landscape of Nigeria,” he said.

Ade Bajomo, president, the Fintech Association of Nigeria (FintechNGR), said fintechs need a regulator that will foster a supportive environment for innovation. 

‘INVESTMENTS INTO NIGERIA’S FINTECH SPACE DROPPED TO $186M IN H1’

Bajomo also said investment into the space declined to $186 million in the first half (H1) of 2024 from $826 million in H1 2023.

“We believe that fintech is the key to unlocking Africa’s potential. But we cannot do it alone. We need investors who see the long-term value of our continent,” Bajomo said.

Speaking about the conference, he said the summit was not just about technology, but also about transforming lives.

He said the conference had the potential to lift people out of poverty and create wealth for future generations.

Bajomo added that there is a need for the right policies, partnerships, and innovations to ensure that Africa’s fintech revolution could be the key to unlocking the continent’s full potential.