The Central Bank of Nigeria (CBN) has cautioned that escalating governance lapses, operational frailties, and tech-driven risks in the non-interest financial services sector could undermine public trust and jeopardize overall financial stability if unaddressed.
This alert came during the Second Annual Interactive Session with the CBN Financial Regulation Advisory Council of Experts (FRACE) and Advisory Committees of Experts (ACE) for Non-Interest Financial Institutions (NIFIs) in Abuja.
CBN Deputy Governor for Financial System Stability, Mr. Philip Ikeazor (represented by Dr. Rita Ijeoma Sike), highlighted the sector’s growing importance via Shariah-compliant, ethical financing amid Nigeria’s financial ecosystem. Yet, its expansion has introduced vulnerabilities like non-compliance, weak governance, operational gaps, and digital threats.
Ikeazor stressed CBN’s dedication to robust Shariah governance, clear regulations, and risk controls to foster sustainable growth. FRACE and mandatory ACEs aim to standardize oversight and compliance; with ongoing dialogues ensuring regulators’ expectations are met.
He praised NIFIs for advancing financial inclusion, MSME support, real-sector funding, and prosperity.
FRACE Deputy Chairman Professor Bashir Umar lauded the revived session (originally from 2014) for bolstering governance and regulator-operator ties. FRACE member Professor Abdul-Razzaq Alaro called for actionable follow-through on resolutions to drive tangible subsector improvements.
Key discussions covered challenges like ACE independence, capacity building, risk strategies, governance enhancements, and innovation. FRACE bridges conventional and faith-based finance for consistency and confidence, while ACEs provide institution-level advisory oversight.
