Pastel, FintechNGR collaborate to drive AI in compliance

Technology firm Pastel has partnered with the FinTech Association of Nigeria to drive the adoption of artificial intelligence in compliance functions in the financial sector.

At the second edition of its breakfast meeting in Lagos with players in the financial sector present, Pastel said that this drive becomes important as Nigerian banks face increasing pressure to modernise compliance infrastructure and reduce exposure to fraud.

Themed ‘Technology for Trust: Reinventing Compliance in the Age of Artificial Intelligence,’ the gathering explored the growing role of AI and automation in fraud prevention, regulatory reporting, and operational resilience.

FintechNGR serves as a platform for the development of the financial technology industry in Nigeria and provides a forum for the exchange of ideas among various stakeholders in the industry.

According to the 2024 Nigeria Inter-Bank Settlement System Fraud Report, Nigerian banks recorded a N52.26bn loss to fraud, a 196 per cent increase from the previous year. This sharp rise highlights the pressing need for intelligent, real-time tools that can match the scale and speed of digital financial transactions in Nigeria and across the continent.

Also, Africa loses billions of dollars annually to illicit financial flows, and among the 24 countries on the FATF grey list, 12 are in Africa. This situation risks increased scrutiny of cross-border transactions, tighter due diligence requirements, and potential impacts on investment and trade opportunities. Beyond financial losses, such reputational effects underline the urgency for strengthened, tech-enabled compliance systems that promote transparency and build confidence in Africa’s financial ecosystem.

In his opening speech at the event, the Chief Executive Officer of Pastel, Abuzar Royesh, emphasised the company’s commitment to designing technology that reflects Africa’s unique operational and regulatory challenges. He introduced the company’s flagship AI-powered solution, Sigma, which was built using local regulatory models and datasets and offers real-time fraud detection, anti-money laundering, automated reporting, comprehensive customer risk assessment, and other features. “Sigma is not a Western system retrofitted for Africa. It is purpose-built using African data, CBN standards, and risk models from across the continent. We’re not just offering tools; we’re helping banks and regulators scale trust and performance in an increasingly complex financial ecosystem,” he said.

Chief Revenue Officer at Pastel, Anthony Amodu, addressed the inefficiencies of traditional compliance systems.

He said, “Manual reporting and fragmented monitoring can no longer keep pace with today’s threats. Sigma offers the speed, clarity, and accountability that C-suite leaders now require, not just to stay compliant, but to stay competitive.”

The event featured a live demonstration of Sigma’s capabilities, showing how the platform helps banks and other institutions detect suspicious activity instantly, generate regulator-ready reports, and integrate seamlessly with existing risk frameworks.

In a keynote address, FintechNGR Director of Advocacy and Programmes Seun Folorunsho, who represented the President of FintechNGR and CEO of Zest Payment Limited, Stanley Jacob, emphasised the global momentum around AI for compliance.

He said, “Non-compliance is extremely costly. Financial institutions around the world are spending over $200bn annually on AI tools for regulatory assurance. Nigeria must move in step with that reality.”

Chief Compliance Officer at Optimus Bank, Wede Thompson, during a fireside chat on regulation and user experience, added, “Regulation is ultimately about trust. If we want to build that trust using artificial intelligence, banks, fintechs, and regulators must work in lockstep and with the end customer in mind.”

The first panel discussion at the event stressed the need for explainability, accountability, and regulatory alignment in AI-powered systems, and the second panel focused on human-centred design in compliance technology.

Pastel & FintechNGR Partner to Boost AI Compliance in Nigeri