The Securities and Exchange Commission (SEC) had on the 16th of June, 2021, released a Regulatory Incubation (RI) program for FinTechs who operate or seek to operate in the Nigerian Capital Market. The program is geared towards test-running Fintechs and their products, to prepare and accommodate them for authorisation and effective regulation, in order to continue or carry out tech-driven capital market operations.
It is an interim measure to bolster effective regulation and also aid innovation without compromising market integrity and ensuring investor’s protection.
The program is expected to begin in the third quarter of 2021, and would admit identified Fintech platforms in cohorts for an initial one-year period. Participation entails two phases:
The Initial Assessment Phase; and
The Regulatory Incubation Phase.
The SEC would provide a FinTechs Assessment Form, to be filled by Fintechs ahead of time, from which the SEC would determine which platform/model falls in which phase.
In particular, FinTechs who consider their models or products unregulated, or who require clarity as to the regulatory regime governing their model/products are encouraged to complete the FinTech Assessment Form.