Bank-Fintech Collaboration Key to Nigeria Achieving $1 Trillion GDP by 2026, NDIC And Stakeholders Say
Collaboration between banks and fintech companies is essential for Nigeria to reach a $1 trillion Gross Domestic Product (GDP) by 2026, according to the Nigeria Deposit Insurance Corporation (NDIC) and other stakeholders. Speaking at the 2024 Finance Correspondents Association of Nigeria (FICAN) annual conference in Lagos, the NDIC’s Managing Director/Chief Executive, Bello Hassan, stressed the importance of this partnership in driving growth within the real sector of the economy.
Hassan delivered a keynote address on the theme, “Nigeria’s Journey Towards a $1 Trillion Economy: Impact of Banks’ Recapitalisation, Opportunities for Fintechs, and Real Sector Growth,” where he underscored the Central Bank of Nigeria’s (CBN) recapitalisation initiative. He explained that recapitalisation is crucial to boosting the resilience, solvency, and capacity of Nigerian banks, enabling them to absorb economic shocks and continue their critical role as financial intermediaries in national development.
He further highlighted that well-capitalised banks are pivotal to achieving the government’s vision of a $1 trillion economy, as growth in the real sector depends largely on accessible and affordable financing. According to Hassan, leveraging the collaboration between banks and fintech companies is vital to reaching the necessary financing levels to stimulate real sector growth.
Hassan also pointed out the need for financial regulators to understand the interconnections within the financial ecosystem to create policies that optimise the efficiency of the entire financial system. He observed that Nigerian banks have traditionally focused on serving large corporations while neglecting small and medium enterprises (SMEs) and underserved populations. Fintech companies, with their innovative financial solutions, have the potential to bridge this gap by simplifying access to finance and reducing bureaucratic hurdles.
Nigeria, being home to the largest fintech market in Africa, boasts numerous startups offering solutions that address the inefficiencies in traditional banking. Hassan emphasized that fintech will play a crucial role in expanding financial access, fostering innovation, and promoting competition as the country moves toward its ambitious $1 trillion economic target.
Chima Nwokoji, National Chairman of FICAN, in his welcome address, raised concerns about fluctuating exchange rates and recent regulatory changes, such as the exclusion of retained earnings from capital calculations. He cited Singapore’s banking sector as a model, highlighting how it has contributed significantly to the country’s emergence as a global financial hub and economic powerhouse.
