The Securities and Exchange Commission (SEC) has moved to calm fears over the security of investments in the rapidly growing fintech sector in Nigeria.
In a statement released on Sunday, SEC Director-General Dr. Emomotimi Agama assured investors that the commission would continue to protect their interests.
He emphasized that the SEC would enforce strict regulations within the fintech ecosystem.
Dr. Agama noted that this regulatory approach would curb the mismanagement of funds.
It would also ensure that operators follow existing rules in order to foster growth and accountability.
He further stressed that fintech operators must align their activities with the standards of the capital market, particularly in the area of fund-raising.
The SEC chief explained that a regulatory environment conducive to the innovative use of technology was crucial in transforming Nigeria’s financial sector.
“The digital age has transformed the investment landscape, offering greater accessibility, innovation, and opportunity,” Dr. Agama stated.
However, he acknowledged that with new opportunities come significant challenges, especially in areas like regulation and investor protection.
“The future of investment in Nigeria will likely be driven by the continued rise of technology, young investors, and evolving financial products,” he added.
Despite the growing use of technology in financial services, Agama assured the public that the SEC would remain vigilant to prevent any potential losses to investors.
He assured that no investor in the fintech space would lose their funds due to regulatory failures.
This declaration comes at a time when fintech in Nigeria is booming.
Many Nigerians are embracing digital platforms for investing, saving, and even trading.
But as Agama pointed out, the digital age has brought new risks and challenges.
One of the most pressing concerns is the lack of robust regulation in some areas of the fintech sector.
With so many new players entering the market, there is a need for oversight to ensure that investors’ funds are used responsibly.
Agama emphasized that the SEC’s role was to provide this oversight while encouraging innovation.
He acknowledged that fintech could play a major role in fostering financial inclusion.
However, he stressed that it was vital to strike a balance between growth and protection.
“The challenge for regulators is to create an environment that supports innovation while ensuring that investor protection remains a priority,” Agama said.
His comments follow recent reports of several Nigerian fintech startups experiencing financial issues.
Some of these companies have faced questions about transparency and their ability to deliver promised returns to investors.
Agama addressed these concerns directly, stressing that regulatory bodies would not allow such companies to harm the reputation of the fintech industry in Nigeria.
“The SEC is committed to ensuring that investors in Nigeria’s fintech sector are well-protected. We are constantly updating our regulatory framework to respond to the evolving landscape,” Agama reassured.
The rise of fintech has opened up new avenues for both young and older Nigerians to engage in investment opportunities.
But with this rise has come an increase in fraudulent schemes and unregulated investment platforms.
In light of this, the SEC has taken steps to ensure that all fintech platforms operating in Nigeria comply with the rules of the capital market.
This includes ensuring transparency in operations and providing investors with the necessary information to make informed decisions.
Agama noted that while fintech operators are largely seen as disruptors in the financial industry, their role in fostering economic development cannot be overstated.
“Fintech is revolutionizing the way we look at investment and financial inclusion. But it must be done within a framework that guarantees security for all parties involved,” he said.
The SEC’s assurances come at a time when the Nigerian government is actively working to develop a comprehensive policy for the fintech sector.
The policy aims to regulate emerging technologies while encouraging innovation in the financial sector.
As Nigeria continues to develop its fintech ecosystem, it remains essential for regulators to work closely with operators to create a balanced environment.
