E-Financial
E-PPAN, NIBSS Upbeat on Strategic Cashless Nigeria
The Nigeria Inter-Bank Settlement System Plc (NIBSS) and the Electronic Payment Providers Association of Nigeria (E-PPAN) said that through strategic alliances and partnerships across the e-payments space, the Central Bank of Nigeria (CBN) cashless policy tops the option to safeguard the nation’s economy.
The duo expressed hope that the trend has come to stay especially with the nationwide implementation of the scheme.
Speaking at a one-day training for ICT journalist on e-payment reporting in Nigeria organized by E-PPAN, Mr. Dipo Fatokun, director, Banking & Payments System Department at the Central Bank of Nigeria (CBN), said that the apex regulator in the financial system aims at creating an electronics payments infrastructure that is nationally utilized and internationally recognized.
Fatokun who was represented by Mr. Musa Itopa Jimoh, head, Banking and Payment System Policy at CBN said that the e-Payments objectives include amongst others the eliminate delays in the payment process. It enables the processing of payments on-line real time; minimize people interaction (contractors and government officials), which implies means less human interaction with the system value chain and improve controls and supervision.
He said that the relevant systems control is embedded, audit trail of transactions maintained for ease of oversight/supervision and improve process efficiency and effectiveness, as it allows for Straight Through Processing (STP) of eligible transactions.
He listed recent developments in the industry to include, “licensing of Mobile Money Operators (MMOs); licensing of Payments Terminal Service Providers; licensing of Switches/Processors; creation of Payments System Policy and Oversight Office (PSPO) to monitor compliance with the various guidelines and standards and payment Card Industry Data Security Standard (PCIDSS) requirements”.
On his part, Osamuede Odiase, head of Public Sector & Corporation at NIBSS, highlighted benefits of e-payment to include Financial Inclusion cum Vision 20:2020, as Cashless Nigeria initiative will lead to reduction on the level of Cash in Economy.
He said, “There will be DMBs investment in e-banking as an alternative low cost channel for serving their customers; High investments by e-payments / e-business operators to the cashless initiative. It will also signal African/ Nigeria Growth Prospects such as growing middle class, bringing the large unbanked population to the space, and integrate the technology savvy youthful population and spur growth in Telecommunication/ Mobile Phones.
According to Odiase, shared services infrastructure is another means of reduction on cost of doing business in Nigeria as there has been mandate to provide shared infrastructure services for the financial industry.
This is even opportunity for Innovation & to set industry standards for e-payments and openings to win market share from rivals.
On the challenges, he listed competitive landscape, regulator policy changes, dearth of required skills and harsh economic (operating) environment and user enlightenment as issues that must be addressed.
Earlier, Onajite Regha, executive secretary and chief executive officer of E-PPAN, said the role of the Association of Nigeria has increasingly become oriented to policy advocacy, capacity building and training towards the achievement of the adoption of E-payment and improving service delivery.
She said that “E-PPAN realizes the important function of the media in achieving its objectives and therefore entered into collaboration with Industry experts to train the men of the fourth estate of the realm whose duty amongst others is agenda setting for the society”.
Regha added that the objective of the training was to enlighten the journalists on the intricacies and peculiarities of providing electronic payment services and also to drive home the benefits to the society.
“While operators and regulators make efforts to ensure that the payment system in Nigeria meets global best practice, it is important that journalists who are the watchdog of the society understand the possibilities, trends, operational framework and challenges of an efficient payment system to ensure effective reporting of the industry”.
The training programme focused on overview of electronic payment industry; understanding policies and regulation of E-payment in Nigeria; understanding the challenges and opportunities of electronic payment and the need for knowledge-based reporting on electronic payment.
Renaissance Capital Africa (Rencap) has named Zenith Bank Plc its top conviction pick among Nigerian banks, ahead of GTCO and AccessCorp, in a fresh research report highlighting the lender’s robust balance sheet and dividend potential despite sector headwinds.
Zenith Bank
The comprehensive review of the Nigerian banking industry notes that Zenith’s current market valuation lags its improving fundamentals, even as the NGX Banking Index posts strong gains recently.
Rencap upgraded Zenith from HOLD to BUY, lifting its target price by 96 per cent based on a lower risk-free rate from falling government bond yields, refined beta estimates, and expectations of cleaner assets post-forybearance resolutions.
Balance Sheet Strength Drives Outlook
Analysts project challenges to earnings growth from anticipated Central Bank of Nigeria (CBN) rate cuts but foresee higher dividend payouts from resolved forbearance and single obligor loan (SOL) exposures alongside rising cash profits.
“Although we expect banks to face challenges in growing earnings… the balance sheet clean-up… will support higher dividend payouts relative to prior years,” the report states, ranking Zenith first, followed by GTCO and AccessCorp.
Key positives include loan write-offs that bolstered asset quality, enabling sustainable growth amid financial system reforms.
Dividend Recovery in Focus
Sector profitability from 2023-2024 was inflated by unrealised foreign exchange gains, which regulations barred from cash dividends, capping payouts despite headline profits.
Zenith historically led payout ratios in 2021-2022 via strong cash generation and capital discipline; Rencap expects a rebound as pressures ease, attracting income-focused investors.
Tier-1 Leadership Reinforced
Zenith Bank recently topped Nigeria’s tier-1 capital rankings for the 16th straight year, per The Banker magazine (Financial Times), affirming its resilience and positioning for long-term value creation.
CBN
- Access Bank Plc
- Fidelity Bank Plc
- First Bank of Nigeria Ltd
- Guaranty Trust Bank (GTBank)
- United Bank for Africa (UBA)
- Zenith Bank Plc
- FCMB (First City Monument Bank) – currently pushing to raise additional capital to secure its international licence.
- Wema Bank
- Standard Chartered Bank (Nigeria)
- Citibank Nigeria
- Stanbic IBTC Bank
- Sterling Bank
- Globus Bank
- Premium Trust Bank
The Securities and Exchange Commission (SEC) has revised the minimum capital applicable to all categories of regulated capital market entities after 10 years.
The minimum capital review, according to the SEC, is informed by the need to strengthen market resilience, enhance investor protection, align capital adequacy with the evolving risk profile of market activities, and ensure that regulated entities possess sufficient financial capacity to discharge their obligations in a sustainable manner.
“The revised Minimum Capital framework seeks to: enhance the financial soundness and operational resilience of market operators; align capital requirements with the scope, complexity, and risk exposure of regulated activities; promote market stability and systemic risk mitigation; and support innovation and orderly development of new market segments, including digital assets and commodities markets,” SEC said in a January 16 circular to market operators.
The SEC circular was sent to all entities regulated by the Commission, including but not limited to core and non-core capital market operators; market infrastructure institutions; capital market consultants; financial technology (FinTech) operators; Virtual Asset Service Providers (VASPs); and Commodity market intermediaries.
All affected entities are required to comply with the revised Minimum Capital Requirements on or before June 30, 2027, the circular said.
“Entities that fail to meet the prescribed requirements within the stipulated timeline shall be subject to appropriate regulatory sanctions, including suspension or withdrawal of registration, as may be determined by the Commission,” SEC said.
Tier-1 Portfolio Managers (Full Scope) involved in the management of Collective Investment Schemes (CIS) and Alternative Investment Funds (Private Equity, Venture Capital, Infrastructure Funds etc) above N20 billion Net Asset Value (NAV), or discretionary and Non-Discretionary Private Portfolio Management Services above N20 billion Assets under Management (AuM), or exposure to foreign instruments up to 40 percent of the NAV are now required to have a minimum capital of N5 billion as against N150 million.
“Any Fund and Portfolio Manager with NAV/AuM of more than N100billion should have a minimum of 10 percent of the NAV/AuM as capital,” SEC added.
For the Tier-2 fund/portfolio managers (Limited Scope) who are in the business of management of Collective Investment Schemes with limited pooled fund creation of not more than 10 times the required capital (N20 billion) on Net Asset Value (NAV), or discretionary and non-discretionary private portfolio management services of not more than N20 billion, or those exposure to foreign instruments of not more than 20 percent of the NAV, now require N2 billion as minimum capital as against low of N150 million.
Likewise, broker-dealers whose services include: client execution, proprietary trading, margin/securities lending and advisory services no longer require N300 million minimum capital to operate but N2 billion.
The SEC said the minimum capital review from 2015 low is in line with its mandate under the Investments and Securities Act 2025 to regulate and develop the Nigerian capital market.
Also, Tier 1 issuing houses who do non-interest finance services, advisory & arrangement services but no underwriting now require N2 billion as against N200 million; while Tier 2 –issuing houses with underwriting and offers a ‘one-stop-shop’ for issuers, provides underwriting services, and renders advisory and product development services require N7 billion minimum capital for this business as against N200 million.
Also, the minimum capital requirement for brokers (client execution only) has been jacked up from N200 million to N600 million, while that of dealers (proprietary trading only) has been moved from N100 million to N1 billion.
Broker-Dealers’ (client execution, proprietary trading, margin/securities lending and advisory services) has been raised from N300 million to N2 billion, while Sub-Brokers’ (Digital) from N10million to N100million; Sub-Broker (Corporate) has been increased from N10million to N50 million. Also, sub-brokers’ (Individual) now need N10 million minimum capital for the business as against N2 million while inter-dealer brokers require N2 billion as against N50 million.
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