Posted by News Express | 4 November 2019 | 976 times
Despite the surge in activities of financial technology (fintechs) companies in the country, which have started encroaching into banks’ businesses, the recently released nine months unaudited results of 13 banks listed on the Nigerian Stock Exchange (NSE) as of September 30, showed that the banks raked in a total of N27.576 trillion as customer deposits.
The amount represents an increase of 11 per cent, compared with the N24.804 trillion recorded by the banks as at December 2018.
The banks are Zenith Bank Plc, Access Bank Plc, Guaranty Trust Bank Plc (GTBank), United Bank for Africa Plc (UBA), FBN Holdings Plc, Fidelity Bank Plc, Ecobank Transnational Incorporated, Sterling Bank, Union Bank of Nigeria Plc, Wema Bank Plc, Stanbic IBTC, Jaiz Bank and Unity Bank.
The growth was attributed to banks’ aggressively marketing and deposit mobilisation strategies as well as their introduction of technology solutions.
Fintechs have continued to encroach on commercial banks’ businesses, thereby threatening the operations and deposit mobilisation by the banks.
For instance, Piggybank, a fintechs, uses recurring card payments to allow its customers create and fund savings account on their mobile phone.
This has prompted the Central Bank of Nigeria (CBN) to start considering developing measures to regulate operations in the sub-sector.
But despite the threat by the fintechs, the banks’ results compiled by THISDAY showed that most of the financial institutions posted higher customer deposits.
For instance, while Ecobank Transnational Incorporated recorded N5.632 trillion as at the period under review, down from the N5.803 trillion it was as at the end of December 2018; Access Bank’s customer deposits stood at N4.239 trillion as at the period under review, significantly higher than the N2.564 trillion it was in the comparable period in 2018.
Also, just as Zenith Bank’s customer deposits increased to N3.951 trillion as at the end of September 2019, up from N3.275 trillion, FBN Holdings also raked in a total of N3.671 trillion as deposits, higher than the N3.487 trillion realised same period last year.
On its part, the United Bank for Africa Plc’s (UBA) customer deposits as at the end of September stood at N3.373 trillion, as against the N3.349 trillion recorded at the end of December 2018, while Guaranty Trust Bank Plc realised N2.390 trillion customer deposits, up from the N2.274 trillion it was as at the end of 2018, and Fidelity Bank’s customer deposits was at N1.116 trillion as at September 30, 2019, up from N986 billion.
The CBN recently said it had taken steps to enhance the regulation of the activities of fintechs in the country.
The Deputy Governor, Financial System Stability, CBN, Mrs. Aishah Ahmad, said this at the recently held International Monetary Fund (IMF)/ World Bank Annual Meetings in Washington DC.
She, however, said in doing this, the central bank would ensure that it did not stifle innovation in the segment of the market.
She added that a lot of disruptions from the fintechs have been from the payment space, stressing the need for increased supervision by the regulator.
She said: “The way fintechs are disrupting the Nigerian financial space, a lot of it has come from the payment space. So, you see them more active in the space for receipts where they are already getting licences from us.
“We’ve seen disruptions in the savings space and disruptions in the micro-lending space.
“So, these are not organisations that the CBN is not aware of. But broadly speaking, our focus has been to identify these organisations.
Ahmad said that was why the CBN was trying to finalise the incubation of some of the companies, adding there were those the apex bank needed to identify and watch what they were doing in order to refine its regulatory framework as the regulations are presently skewed to banks and the payment service companies.
She added: “We are also looking at moving from regulation by identification, to more around regulating their activity.
“So, if you are not a bank, you cannot get a banking licence, but if you operate as a bank then we have to regulate what you do. We are looking at ensuring professionalism as well as in what we do in terms of regulation.
“We don’t want to stifle innovation, so we want more companies to come up and assist because fintechs do a lot in furthering the financial inclusion objectives of the central bank.”
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