The Nigerian Exchange Limited (NGX) says collaboration between fintech companies and the capital market will effectively create a digital economy in the country.
Temi Popoola, chief executive officer of NGX, said this during the 2021 Chartered Institute of Stockbrokers (CIS) national workshop held in Abuja.
Speaking on the theme, ‘Roadmap to a Digital Nigeria: Harnessing Fintech, Cryptocurrencies and Artificial Intelligence to Create Stronger Financial Markets,’ Popoola explained that fintechs have a huge potential to transform the capital markets and effectively build a digital economy.
The collaboration can increase financial inclusion as well as cashless payments, he said.
Popoola was represented by Jude Chiemeka, divisional head, trading business at NGX.
He said that rather than seeing fintechs as competitors, they should be regarded as potential partners to incumbent capital market infrastructure providers like NGX.
Citing the Pulse of FinTech H2 2020 report, Popoola said that the global investments by fintechs were $105 billion despite a significant drop compared to $165 billion recorded in 2019.
He noted that Nigerian fintechs raised about $439 million in 2020.
According to him, fintech companies are transforming the financial services industry by focusing on targeted products and services, automating and commoditising high margin processes, strategic use of data and collaborating with incumbents.
“As Africa’s largest economy and with a population of 200 million — 40 per cent of which is financially excluded, Nigeria is classified as a developing FinTech economy compared to its more mature global peers such as the UK, Singapore, Australia, Sweden and India,” he said.
“EY estimates that Nigerian FinTech revenues will reach $543 million by 2022, driven by increasing smartphone penetration, unbanked populations and a focused regulatory drive to increase financial inclusion and cashless payments.
He reiterated that NGX would continue to set up its solutions and innovation hub to explore projects that leverage distributed ledgers, cryptocurrency and artificial intelligence to improve financial inclusion and market accessibility.