Kelechukwu Mgboji 
The Securities and Exchange Commission (SEC) has warned that companies using FinTech to raise public funds without regulatory approval could expose investors to fraud, thereby undermining the Commission’s investor protection mandate.
Delivering a keynote address on Tuesday in Lagos at the FintechNGR Conference with the theme “Positioning Africa’s Fintech Ecosystem to Accelerate Inclusive Growth,” SEC Director General, Dr. Emomotimi Agama, said that the Commission had prioritised collaboration with other regulators, both locally and internationally to create “smart regulation,” a harmonised regulatory environment that encourages fintech innovations.
He noted that Fintech had emerged as a solution, offering services that are not only accessible but also cost-effective. He disclosed that while FinTech offers great potential, it posed significant regulatory risks as large amounts of investor data could be misused without consent, and the systems are vulnerable to cyber attacks with potentially severe consequences.
“However, the success of fintech and financial services in driving inclusive growth hinges on the regulatory environment. Regulation plays a pivotal role in ensuring that fintech solutions are safe, sustainable, and beneficial for all users” he stated.
He, therefore, pointed out that using Fintech without the approval of the Commission could expose average investors to risk of fraud, and consequently undermine the Commission’s role of protecting investors.
“By leveraging innovative technologies such as mobile payments, peer-to-peer lending, and digital currencies, fintech platforms are driving financial inclusion at an unprecedented scale.
“This allows individuals, small businesses, and underserved populations to access the financial system, thereby contributing to broader economic participation and growth,” SEC DG stated.
