NIGERIA Law and Practice Contributed by: Isa Alade, Seyi Bella, Ayodele Adeyemi-Faboya and Ayomikun Ogunkanmi, Banwo & Ighodalo
would be announced in 2025. The National Insurance Commission (NAICOM) has also intro - duced a regulatory sandbox programme for eli - gible applicants. In furtherance of the CBN’s commitment to building a financial services sector that promotes innovation, effective service delivery, healthy competition and financial inclusion, the CBN Sandbox Regulations were released in January 2021 (the “Sandbox Regulations” ). The Sandbox Regulations set out the requirements provided by the CBN for conducting live tests on innova - tive products, services and other solutions in a controlled environment. To this end, the CBN will review the products and solutions of applicants (licensed institutions, fintech companies, inno - vators and researchers) during their implementa - tion. After calling for applications in December 2022, the CBN admitted selected applicants into its regulatory sandbox programme in 2023. 2.6 Jurisdiction of Regulators The legislation establishing various regulators specifies the jurisdiction limits of such regula - tors. The CBN is the apex monetary authority in Nigeria and is responsible for the regulation of all banks and financial institutions operating in Nigeria. The bulk of fintech companies in Nige - ria deal in payment/financial services and, in so doing, assume quasi-banking functions – there - by coming within the regulatory purview of the CBN. Nigeria’s primary regulatory body for invest - ments and capital markets transactions is the SEC. The jurisdiction of the SEC in the regulation of operating fintech companies can be found in the operation of Investech applications, crowd - funding platforms, and, in recent years, cryp -
tocurrencies, among others. In the same vein, certain fintech companies that offer the option of pooling together capital from individual investors towards investment in certain asset classes (col - lective investment schemes) must be registered with the SEC. NAICOM regulates the insurance industry in Nigeria. Its jurisdiction extends to insurtech companies that carry on insurance businesses. The NDPC oversees the implementation of the NDPA and regulates the processing of personal information, along with related matters. Furthermore, the NCC is empowered by the Nigerian Communications Act 2003 to regu - late the telecommunications industry in Nigeria. Thus, fintech companies offering services that involve the use of mobile networks or mobile phones, such as mobile money, are subject to the NCC’s regulatory purview and must obtain operating licences from the NCC. Finally, the FCCPC is Nigeria’s apex regulator for consumer protection and competition affairs. Acting as the regulatory authority saddled with implementing the Federal Competition and Con - sumer Protection Act (FCCPA), the FCCPC regu - lates the activities of fintech companies, aiming to protect the rights of consumers under the FCCPA. 2.7 No-Action Letters Fintech regulators in Nigeria do not tradition - ally issue “No-Action” letters in the same way as regulators in some other countries, such as the U.S. Securities and Exchange Commission. However, Nigerian regulators do provide regula - tory clarity and approvals through other mecha - nisms. For example, the SEC may issue approval
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