E-Financial
CBN Reiterates Need to Secure Payment Systems
Central Bank of Nigeria (CBN) has reiterated the need to secure payment systems in the country stem fraudulent activities in the financial sector.
Mr Dipo Fatokun, Director, Banking and Payment Department, CBN, stated this while presenting a keynote address on emerging regulations to protect online, mobile and payment services in Abuja.
The workshop, organised by Maxut Consulting Experts and Vasco Data Security in collaboration with the CBN was centered on the emerging trends in banking and payment systems and regulatory and security implications.
Fatokun said there was the need for continuous effort by stakeholders to develop efficient, reliable and electronic payment systems in the country.
According to him, one of the key tasks of the CBN is to promote the smooth operations of an efficient payment system, which is core to the financial stability of any country.
He said payment systems had important implications for monetary policy implementation and efficiency of the economy.
“To achieve broad objectives of the Payments System, CBN develops and regulates the implementation of regulation to facilitate the growth of initiatives that will harmonise payment operations in the country.
“In its regulatory role, the CBN is careful to approach the dynamic of payment systems policy creation as a delicate balance in order not to stifle innovation and growth in the payment systems.
“In addition, the bank has developed a financial inclusion strategy, the PSV 2020 Vision and cash-less policy drive with specific targets and timelines.
“The sustenance of these initiatives will ensure that financial services are provided at affordable costs to sections of disadvantaged and low-income segments of the society.’’
Fatokun explained that because of the emergence of new technologies, there was a continuous need to update payments system regulation as a result of its dynamic and ever changing nature.
“Technological developments have led to disruptive innovations by financial Technology (FinTech) companies in the financial system.”
These innovations have facilitated the expansion of electronic payments and helped in providing financial services to previously unreached groups.
He said the CBN had tried to incorporate all service providers into the regulatory space but some preferred to remain in the unregulated space due to perceived difficulties of licensing and regulation.
He further said that the participation of the apex bank in the workshop would enhance the knowledge of staff on the operations of non-financial service providers in the payments system.
Fatokun urged banks in the country to ensure standardisation in all transactions while making available their Application Programming Interphase (API).
API is a set of functions and procedures that allows access to data or a service in order to provide greater functionality to the application user.
He said banks had been directed to make their APIs available to FinTechs but Nigerian banks would fully implement this when implications of its availability was fully understood.
Earlier, Mr Micheal Odusami, the President, Maxut Consulting said the workshop would ensure the apex bank was abreast with the current trends and future of the industry.
Odusami said the workshop would also expose the country to what was obtainable from different parts of the World in the sector as some countries were a little more advanced than us.
“They are already putting regulations in place to address some banking issues and sharing them here will see how some of the stuff we are already doing will help us.
On the level of online security risk in the country, Odusami said a lot of the challenges faced was around social engineering, people impersonating other people and so on.
He said that majority of the fraud recorded within the country was carried out by people inside the system itself, “people that know how the system works and they compromise it’’.
He commended efforts by the CBN toward ensuring the mitigation of fraud in the banking sector but added that a lot still needed to be done to secure transactions in the sector.
E-Financial
Fidelity Bank Reports N124.3Bn Pre-Tax Profit for 2023
Fidelity Bank Plc has recorded a profit before tax of N124.3 billion for the year ended December 31, 2023, indicating a 131.5 per cent increase from N53.7 billion posted in the 2022 financial year.
The bank disclosed this in its 2023 full year audited financial statement issued to the Nigerian Exchange Ltd. (NGX) on Tuesday in Lagos.
Fidelity Bank said it would also pay investors a final dividend of 60k per share and a total dividend of 85 kobo per share for the reporting period.
This represents a 70 per cent increase compared to the 50 kobo per share paid to its shareholders in the previous year.
The financial institution stated that this led to an increase in return on average equity of 26.5 per cent in the year under review from 15.6 per cent in the corresponding year.
According to the financial statement, the bank’s gross earnings increased by 64.9 per cent year over year to N555.83 billion.
The bank stated that this was driven by 81.6 per cent growth in net interest income which increased from N152.7 billion in year 2022 to N277.37 billion in the 2023 financial year.
This led to a profit after tax of N99.45 billion, representing a 112.9 per cent annual growth.
Commenting on the performance, Nneka Onyeali-Ikpe, managing director of Fidelity Bank, said the financial institution closed the financial year with strong double-digit growth across key income and balance-sheet lines.
Ms Onyeali-Ikpe stated that the bank’s performance in 2023 was an attestation of its capacity to deliver superior returns to shareholders despite the difficulties in our operating environment.
She said, “A review of the financial performance showed that the bank grew its net interest income by 81.6 per cent to N277.4 billion. This was driven by a 55.5 per cent increase in interest income, thus reflecting a steady rise in asset yield throughout the year.
“The average funding cost dropped by 20bps to 4.4 per cent due to increased low-cost funds that grew from 83.6 per ent in 2022 to 97.4 per cent in 2023.
“The combination of higher asset yield and lower funding cost led to an increase in net interest margin of 8.1 per cent from 6.3 per cent in 2022 financial year.”
According to her, the total customer deposits crossed the N4 trillion mark, as deposits grew by 55.6 per cent from N2.6 trillion in 2022.
She noted that the increase was driven by 81.1 per cent growth in low-cost funds.
Mrs Onyeali-Ikpe explained that despite the challenging operating environment, the bank reaffirmed its devotion to helping individuals grow and inspiring businesses to thrive.
She said the bank also committed to empowering economies to prosper by increasing net loans and advances to N3.1 trillion from N2.1 trillion in the 2022 financial year.
The managing director stated that despite the growth in its loan portfolio, regulatory ratios were maintained well above the required thresholds.
Mrs Onyeali-Ikpe noted that the bank liquidity ratio stood at 45.3 per cent in the year ended 2023, from 39.6 per cent in the year 2022, while the capital adequacy ratio rose to 16.2 per cent, compared to the minimum requirement of 15.0 per cent.
“We recognise the changing dynamics in the Nigerian banking space and the need to monitor and proactively manage evolving risks. The proposed final dividend of 60 kobo per share reflects our commitment to strong value creation and returns to our shareholders.
“Fidelity Bank has consistently paid dividends since 2006,” she said.
E-Financial
ClaimBuddy Bags $5m to Streamline Insurance Claims for Hospitals, Patients
ClaimBuddy, insurancetech startup has raised $5 million in its Series A funding round led by Bharat Innovation Fund (BIF), with participation from Japanese VC firm CAC Capital, Chiratae Ventures, and Rebright Partners.
The Delhi NCR-based startup plans to utilize the capital to enhance its tech infrastructure, onboard skilled talent, and diversify its product offerings.
Founded in 2020 by Khet Singh Rajpurohit and Ajit Patel, ClaimBuddy aims to streamline the insurance claims process for both patients and partner hospitals through its digital platform.
ClaimBuddy has already assisted over 35,000 patients and collaborated with more than 250 hospitals nationwide, establishing itself as a comprehensive solution for medical insurance claims.
CEO Rajpurohit expressed confidence in leveraging the investment to introduce innovative financial tools and further improve healthcare experiences. ClaimBuddy’s focus aligns with addressing fundamental issues in insurance claim settlements and patient experiences, as highlighted by BIF’s Ashwin Raguraman.
ClaimBuddy faces competition from other insurtech startups but aims to disrupt the Indian insurtech sector, which is witnessing a surge in digital-first solutions and increased investor interest.
The Indian insurtech space is projected to be a significant segment within the larger fintech opportunity by 2030.
E-Financial
Recapitalisation: UBA Seeks Shareholders’ Nod to Raise Capital
United Bank for Africa (UBA) has said that it will seek shareholders’ approval at the company’s 62nd annual general meeting (AGM) to raise capital.
The AGM is scheduled to be held on May 24.
UBA disclosed this in a statement filed on the Nigerian Exchange Limited (NGX) on Monday.
The development is coming after the Central Bank of Nigeria (CBN), on March 28, directed commercial banks with international licences to raise their capital base to N500 billion, while national and regional financial institutions’ capital bases were pegged at N200 billion and N50 billion, respectively.
UBA said the board will propose the capital be raised in the Nigerian or international capital markets by way of public offerings, private placements, rights issue or other transaction modes.
The bank said the decision to raise the capital is subject to regulatory approval after consent from shareholders.
According to UBA, the instruments “can either be as a standalone issue(s) or by the establishment of capital raising programmes, whether by way of public offerings, private placements, rights issues and/or other transaction modes, at prices, coupon or interest rates determined through book building or any other acceptable valuation method or combination of methods, in such tranches, series or proportions, within such maturity periods and at such dates and upon such terms and conditions as may be determined by the board of directors of the company subject to obtaining the requisite approvals of the relevant regulatory authorities”.
The company said the board would also propose increasing its issued share capital, from N17,099,710,683 to N22,500,000,000.
UBA, with a capital base of N115.82 billion, needs to raise N384.19 billion to meet the minimum capital requirement for international licence holders.
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