Operators of financial technology (fintech) companies and banks have urged the Central Bank of Nigeria (CBN) be more innovative in designing the framework for open banking in the country.
Speaking recently at the KPMG Cyber Security Roundtable in Lagos, the Director, Banking and Payments System Department, Dipo Fatokun, said the central bank would soon make public, an exposure draft on open banking in the country. Open Banking is a system that provides a user with a network of financial institutions’ data using Application Programming Interfaces (APIs).
The Open Banking Standard defines how financial data should be created, shared and accessed. By relying on networks instead of centralisation, open banking helps financial services customers to securely share their financial data with other financial institutions.
Benefits include more easily transferring funds and comparing product offerings to create a banking experience that best meets each user’s needs in the most cost-effective way.
According to Fatokun, the CBN was still examining the open banking framework, after which it would produce a regulation on what the banks, fintechs and other players in the sub-sector need to do as well as the risk management system. Fatokun said the framework would be designed by an inter-department committee, saying when the committee is done with the work, it would be taken it to the Governor and his Deputy for review and approved, before the draft would be issued.
(ThisDay)
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