The Governor of the Central Bank of Nigeria (CBN), Godwin Emefiele has charged banks and other financial institutions to be proactive about the emerging threats posed by financial technology (fintech) to avoid crisis in the sector.
The apex bank chief, who reiterated the reality of threats posed by fintech, called on members of the Chartered Institute of Bankers of Nigeria (CIBN) to be at the forefront of sensitisation in the banking industry to find lasting solutions.
Emefiele stated this during the investiture of Uche Messiah Olowu as the 20th President and Chairman of Council of CIBN, over the weekend, in Lagos.
Represented by his deputy, in-charge of Economic Policy, Uche Nnanna, the banker said: “In our industry we have common threat, the threat posed by fintech. I call on CIBN to up its ante. As far as advocacy is concerned, it should be your major focus, to find lasting solutions to the threats posed by fintech.”
Disclosing how fintech risks would be mitigated, the immediate-past President of the institute, Prof. Segun Ajibola, said banks and other corporate institutions must leverage on Enterprise Risk Management (ERM), an integrated approach to managing risks.
Ajibola, who stated that modality for managing those new risks has to be defined and deployed in banks, explained that when banks fail to carry on the approach, the risk would crystallise, thereby causing a negative impact on the bank, which may lead to financial crisis.
“The threat is real, just as the environment is growing globally. Banks should, from time to time, identify those risks, evolve ways of managing and mitigating these risks so that when the risk crystallise, the negative impact on such bank will not be too phenomenal.
“This is what we cannot as a country avoid today and that is why we are pleading and preaching EMR, which will help to identify the problem before they arise, enable you to police your system in a way that it will not become vulnerable to all forms of risks.
“Banks and corporate institutions should buy into them, invest and deploy them so that the negative impact of this risk on the banks, corporate institutions and Nigerian economy will not be devastating,” he said.
Earlier in his acceptance speech, elated Olowu promised to enthrone ethics, professionalism and transparency in the banking industry, stressing that the sector lacked proper skills-set, but assured of taking certifications on enterprise risk management as major focus.
The new CIBN boss said his tenure would focus on five key strategic areas, which include rules and standards, skills and competences, research and advocacy, technology and resources, and brand visibility.
“It is a new dawn for banking in Nigeria because we are playing at the global stage as chairman of global banking education standards board. So, it means we have to up our ante in terms of right knowledge, skill and quality to our stakeholders and also have proactive intervention policies to the government and the judiciary.
“We are the managers of resources of money, therefore, we should bring to bear, ethical conducts in our behavior,” he added.