‘Regulatory framework, consumer protection’ — highlights of Nigerian fintech regulatory commission bill
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The house of representatives is considering a bill seeking to establish the Nigerian Fintech Regulatory Commission (NFRC) to provide a legal and regulatory framework for the country’s financial technology industry.
The bill, which has passed the second reading at the house, is sponsored by Fuad Laguda, an All Progressives Congress (APC) lawmaker representing Surulere I federal constituency of Lagos state.If passed into law, the legislation would create an independent body responsible for the licensing, regulation and supervision of fintech operators across the country.OBJECTIVES OF THE BILL
According to the proposed legislation, the objective is to promote the implementation of the national fintech policy, establish a regulatory framework for the industry, and encourage both local and foreign investments.
It also seeks to ensure fair competition, protect the rights of consumers and service providers, and promote innovative services in line with global best practices.“To encourage the development of a fintech manufacturing and supply sector within the Nigerian economy and also encourage effective research and development efforts by all fintech industry practitioners,” the bill said.
“Ensure that the needs of the disabled and elderly persons are taken into consideration in the provision of fintech services.”
ESTABLISHMENT, FUNCTIONS OF THE COMMISSION
The bill proposes that the NFRC will be a body corporate with perpetual succession and powers to enter into contracts, own property and sue or be sued in its corporate name.
The commission will be structured into departments and will have regional offices in each geopolitical zone of Nigeria headed by regional directors.
Among its key functions are facilitating investments and market entry for provision and supply of fintech services, protecting consumers against unfair practices, and granting and renewing licences for fintech businesses.
Other functions include promoting infrastructure sharing among licensees, advising the minister on policy formulation for the sector, and representing Nigeria at proceedings of international organisations and for matters relating to regulation of fintech.
“The commission shall at all times carry out its functions and duties and exercise its powers hereunder efficiently, effectively and in a non-discriminatory and transparent manner and in a way that is best calculated to ensure that there are provided throughout Nigeria, subject to the regulatory controls specified in this Act, all forms of fintech services, facilities and equipment on such terms and subject to such conditions as the commission may from time to time specify,” the bill said.
MEMBERSHIP OF THE COMMISSION
The proposed bill said the NFRC will be governed by a 14-member board, comprising a chairman, a director-general, six executive commissioners and six non-executive commissioners — one each from the six geopolitical zones.
The bill said all members of the board will be appointed by the president, subject to confirmation by the national assembly.
Also, the bill provides that the director-general and the commissioners must possess experience in fields such as economics, finance, banking, ICT, law, or engineering.
“A person shall not be appointed or remain in office as a commissioner if he is not a Nigerian citizen; he is not ordinarily resident in Nigeria; he is a serving member of the National Assembly, State House of Assembly or any Local Government Council; he is incapacitated by any physical illness; he has been certified to be of unsound mind; he is an undischarged bankrupt; he has been convicted in Nigeria or elsewhere of a criminal offence, being a misdemeanour or felony; or he has at any time been removed from an office of trust on account of misconduct,” the bill added.
The proposed legislation said each commissioner will serve a four-year term, renewable once, while all except the director-general will hold office on a part-time basis.
It noted that the president may suspend or remove any commissioner found guilty of misconduct, unqualified or conflict of interest as provided under the Act.
According to the bill, vacancies arising from death, resignation or removal are to be filled by the appointment of another person by the president.
MANAGEMENT OF THE COMMISSION
The proposed bill said the director-general will be responsible for the day-to-day management of the commission and the execution of board policies.
“The director-general shall be a person possessing sound knowledge sound ability in the organisation and management of fintech matters and subject to sections 8(3) and 8(4) of this Act, he shall hold office for a term of 4 years and may be renewed for another term of 4 years and no more,” the bill said.
Also, the executive commissioners must possess sound knowledge and competence in the organisation and management of fintech matters.
In line with section 8(4) of the Act, the bill said they shall serve a four-year term, which may be renewed for one additional term of four years and no more.
