Experts Urge Collaboration Between Fintechs, Banks

Some experts have emphasized the need for a strengthened collaboration between fintechs and financial institutions to enhance the former’s intermediary role.

They declared this at the Information Technology (IT) and consulting webinar hosted by the Institute of Chartered Accountants of Nigeria (ICAN) recently.

Speaking at the event, Demola Igbalajobi, Executive Director of SystemSpecs, specifically lauded fintech organisations for effectively taking up the role of financial intermediary.

He added however that fintechs must improve on their relationship with traditional financial institutions, open banking, artificial Intelligence (AI) and web automation.

He explained that the rapid growth of digital technology innovation had spurred fintech platforms, facilitating solutions in several areas including mobile money, insurtech, agrictech, crypto transactions, and many others.

“Fintechs are making inroads due to a number of factors including their agility and speed to market, less risk-aversion, focus on service rather than regulation, and the current inefficiencies in the operations of traditional banks.

“Fintech can be operators that provide direct services to customers. They can provide platforms as a service, develop platforms for other financial entities, or serve as a support platform for ancillary services such as data referencing, data verification, and collection.”

He expressed further that as a result of modern technology, fintechs are aiming to replace the current framework of licensed intermediaries and trusted central gatekeepers.

He pointed out that despite growing innovations, there were still areas of concern as fintech platforms become ever more important as facilitators of financial transactions.

“These include the need for fintech specific regulations as well as compliance with the various regulators in the system such as the Central Bank of Nigeria (CBN), Securities Exchange Commission (SEC), and the General Data Protection Regulation (GDPR).

“There is also need for data privacy, data security and stability of the fintech companies themselves, to reduce risk to consumers,” he said.