The Central Bank of Nigeria (CBN) has given the green light for open banking to hit the scene in Nigeria! This is touted to be a game-changer for financial innovation and financial inclusion in Nigeria and Africa as a whole.
Sidebar: Open banking is like giving the keys to our financial data castle to third-party financial service providers. Just like how we let social apps access our data to provide a more personalised experience on the apps, we can give permission to these providers to access our financial data from our banks. This allows for more customised and tailored financial services that suit our individual needs and preferences.
Yeah, sharing data can be risky business. That is why, to ensure our data privacy, the Nigeria Data Protection Regulation was released in 2019 as a foundational pillar for open banking.
Speaking about foundations…
The CBN didn’t just wake up two days ago and decide to break down all the walls between traditional banks and the fintech peeps.
It all started when a group of industry veterans like Adedeji Olowe formed an “open banking” working group, which ultimately became known as “Open Banking Nigeria“. They talked to banks, fintech, the CBN, and other international stakeholders. They also earned early backing from the likes of Sterling Bank, KPMG, PwC, EY, Paystack, TeamApt, Wallet Africa, and OnePipe. Eventually, other fintech operators like Mono, Switch, Lendsqr, Palmpay, Carbon, and Trium joined the crew.
Subsequently, the CBN released the regulatory framework for open banking in Nigeria on February 7, 2021. This laid the groundwork for the draft of the operational guidelines in May 2022. This draft is what has now become the law for bankers, fintech and tech companies supervised by the CBN.
Now, fintech companies such as Mono, Okra, and Stitch won’t have to contort around a maze of regulations looking for innovative ways to access and provide banking data for your favourite fintech, as getting data will feel like plucking low-hanging fruit.
Zoom out: With this, Nigeria becomes the first African country with open banking regulations. Open banking, however, is already being explored in 11 countries across Africa including countries like Kenya, South Africa and Ghana.
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Cross Switch Ghana LTD has obtained approval from the Bank of Ghana to operate as an Enhanced Payment Service Provider (EPSP).
What does the fintech need an EPSP for?
Ghana’s demand for payment technology isn’t slowing down and Cross Switch Ghana hopes to use this licence to help the country’s fintech space match its pace.
With its shiny new licence, the fintech will digitise merchant payments, collections and disbursements for e-commerce, and remittances. It also hopes to foster financial inclusion, for which Ghana’s National Payment Systems Strategic Plan (2019–2024) created an enabling regulatory environment.
Cross Switch Ghana is part of a big family—Cross Switch International S.A.R.L. The pan-African company told ITnewsafrica that they’re over the moon about their new licence, but let’s be honest, it’s just another shiny addition to their already impressive cap of accomplishments.
The company has acquired and established a number of technology and payments businesses in Benin, Egypt, Ghana, Kenya, Morocco, Nigeria, and South Africa. It also recently announced its acquisition of a 50% stake in Vantage Payment Systems, a leading Moroccan fintech that provides online payment solutions.
So, Cross Switch is not just switching things up in Ghana but all across the continent.
Swiatek joins Moniepoint from US-based bank Capital One, where he was managing vice president. He also worked at US-based hedge fund Bridgewater, where he helped the company grow from 150 workers to over 2,000.
At Moniepoint, he will develop policies, tools, metrics, and a culture that will support the expansion of Moniepoint’s business. Already, Moniepoint has a customer base of more than 600,000 businesses in 2022. The company processed an annual total payments volume (TPV) exceeding $170 billion. The company currently employs 967 staff and 6,000 business relationship managers, and managing their operations is where the bulk of Swiatek’s efforts will be concentrated.