Fintech Is Strategic: Why CBN Licence Upgrade Matters

by Mohammed Bello Doka 

On January 2026 in Lagos, a quiet but consequential regulatory shift took place that could shape the future of Nigeria’s financial system for decades. The Central Bank of Nigeria (CBN) formally upgraded the operating licences of major fintech firms and microfinance banks — including Opay, Moniepoint Microfinance Bank, PalmPay, Kuda and others — to national status, following their compliance with regulatory and capital requirements.

It was not just another regulatory announcement. It was a statement of intent.

By this decision, the CBN effectively acknowledged a reality Nigerians already live with daily: fintechs are no longer fringe players — they are now strategic national infrastructure.

Across markets in Lagos, farms in Benue, campuses in Ilorin, shops in Aba and motor parks in Kano, millions of Nigerians rely on fintech platforms for transfers, payments, savings and daily business transactions. This adoption did not happen by accident. Nigerians chose fintechs because they proved faster, easier to use, more reliable and cheaper than many traditional banking options.

Accounts are opened in minutes, transfers are often instant, fees are lower, and services are available through mobile phones and agent networks where brick-and-mortar banks are absent. In a country where millions remain underbanked, fintechs filled a gap banks either could not or would not fill.

Beyond convenience, fintechs have become powerful engines of financial inclusion. Through POS agents and digital wallets, they have pulled traders, artisans, transport workers and rural dwellers into the formal financial system. They support small businesses with payment solutions, cash flow stability and access to digital commerce. This is not theoretical inclusion — it is practical, daily economic participation.

Just as important is their employment impact. Fintech firms employ thousands of Nigerians directly as engineers, compliance officers, customer service agents, marketers and operations staff. Indirectly, they support hundreds of thousands of POS operators, aggregators and small vendors nationwide. At a time of severe youth unemployment, fintechs rank among Nigeria’s most effective private-sector job creators.

Yet, despite these contributions, fintechs have faced sustained pressure from parts of the mainstream banking sector that see them primarily as competitors. Legacy banks enjoy historical advantages — capital depth, infrastructure control and regulatory familiarity — while fintechs are newer entrants challenging old models. Competition, however, is not a threat to the system. It is the system working.

This is why the CBN’s licence upgrade matters. It sends a clear signal that innovation will not be punished for succeeding, and that regulation will be aligned with scale, not used as a blunt weapon to protect incumbents.

Still, support alone is not enough. Oversight is non-negotiable.

As fintechs grow, they must not become channels for money laundering, terrorism financing, drug trafficking or cybercrime. Advanced economies faced the same risks — and they did not respond with bans or hostility. They responded with smart regulation.

In the United Kingdom, the Financial Conduct Authority enforces strict, risk-based AML and counter-terrorism financing rules, backed by real-time transaction monitoring and heavy penalties for violations. In the United States, fintechs operate under the same Bank Secrecy Act obligations as banks, filing Suspicious Activity Reports to FinCEN and working closely with law enforcement. Singapore ties fintech licences to governance quality, board accountability and continuous supervision. The European Union dismantled anonymity through beneficial ownership registers and data sharing. India combined mass financial inclusion with digital identity, transaction limits and real-time monitoring.

The lesson is clear: technology-driven finance can be more traceable than cash — if regulated properly.

Nigeria must follow this proven path. Protection must mean fair competition, not regulatory immunity. Oversight must be firm but intelligent — risk-based KYC, strong AML/CFT enforcement, technology-driven supervision, and zero tolerance for abuse. Fintechs must have guaranteed access to payment infrastructure, while meeting the highest standards of compliance and governance.

The CBN’s licence upgrade is the right first step. But consistency will determine success. Regulation must be predictable. Enforcement must be even-handed. Innovation must not be stifled by vested interests.

Fintechs are not enemies of banks. They are partners in national development. Countries that understood this early are now global financial leaders. Those that resisted innovation paid the price.

Nigeria cannot afford that mistake.

By recognising fintechs as strategic institutions — while insisting on strong oversight — the CBN has chosen balance over fear, progress over protectionism, and national interest over institutional rivalry.

If sustained, this decision will not only strengthen Nigeria’s financial system — it will strengthen the Nigerian economy itself.

Mohammed Bello Doka can be reached via [email protected]