FairMoney Microfinance Bank says regulatory compliance and consumer protection are essential to building customer trust in Nigeria’s technology-driven banking sector.
Mr James Edeh, the bank’s Head of Compliance, stated this in a statement on Wednesday.
He said compliance should extend beyond regulatory obligations to encompass transparency, responsible lending, data protection and effective complaint resolution.
He said financial institutions must ensure that technological innovation was accompanied by safeguards protecting customers as digital platforms expanded access to financial services.
According to him, customers need assurances that their funds are protected, personal information handled responsibly and financial products presented in clear and fair terms.
Citing the Enhancing Financial Innovation and Access (EFInA) 2023 Access to Financial Services Survey, Edeh said formal financial inclusion rose from 56 per cent in 2020 to 64 per cent in 2023
However, he noted that 26 per cent of Nigerian adults remained financially excluded, underscoring the need to expand access while strengthening consumer protection.
He said fintech companies and microfinance banks could leverage technology to improve access to payments, savings, and credit but must manage the risks accompanying digital financial services.
“The goal should not be to slow innovation through unnecessary controls.
“It is to ensure that innovation is developed within a framework that gives customers confidence in the services they are using,” he said.
Edeh advocated integrating compliance into product development and business processes rather than addressing regulatory concerns only after problems emerged.
He said decisions concerning data management, product design, lending, customer communication and complaint handling all had implications for consumer protection.
On digital lending, he stressed the importance of providing customers with clear information about loan terms, applicable charges and other material conditions.
He also highlighted the need for credible complaint channels and responsible handling of customers’ personal information.
Edeh said FairMoney Microfinance Bank, licensed and regulated by the Central Bank of Nigeria (CBN), operated within a prudential framework designed to support the financial system’s safety and soundness
He added that eligible deposits with the bank were insured by the Nigeria Deposit Insurance Corporation (NDIC), subject to applicable coverage limits and the scheme’s terms and conditions.
According to him, financial institutions must also comply with relevant consumer protection and data protection regulations, including applicable requirements issued by CBN and the Federal Competition and Consumer Protection Commission.
Edeh said compliance provided a framework for aligning business growth and technological innovation with customers’ interests.
He added that digital banking’s long-term success would depend not only on technological efficiency but also on transparency, effective governance and institutions’ commitment to protecting customers.
“Technology may change how banking is delivered. It does not change the fundamental relationship between a financial institution and its customers.
“That relationship remains grounded in trust,” he said.
