Egypt and Nigeria unite on fintech

The Central Financial institution of Nigeria and the Central Financial institution of Egypt have signed a Memorandum of Understanding (MOU), with two of the most important economies in Africa agreeing to arrange a “Nigeria-Egypt Fintech Bridge.”

Whereas the complete scope of the collaboration is but to be detailed, the partnership between the 2 central banks is anticipated to embody joint regulatory initiatives, coordinated licensing and authorized frameworks, data and knowledge trade, fintech cross-referrals, and expertise growth.

In response to Aishah Ahmed, deputy governor for monetary system stability on the Nigerian Central Financial institution, the transfer is especially geared in direction of enhancing monetary inclusion. It’s hoped that Nigerian-Egyptian collaboration on fintech options will permit extra residents from each international locations to entry formal monetary providers. At current Abuja and Cairo have among the largest unbanked populations anyplace on the planet.

The unbanked lots

Roughly 40% of the Nigerian inhabitants doesn’t have a checking account, with that determine rising as much as 75% of Egyptians. Each economies proceed to rely closely on money, with over two thirds of Egyptians solely utilizing money to conduct purchases or make transfers, in accordance with the World Financial institution. Rume Ophi, a fintech and blockchain analyst based mostly in Lagos, tells African Enterprise that “collaboration between the varied authorities businesses will assist drive monetary inclusion in Nigeria and Egypt.”

In a press release, Ahmed stated: “We sit up for cultivating an modern area for fintech startups and entrepreneurs in Egypt and Nigeria to speed up monetary inclusion, deepen our cost techniques, and drive financial development throughout the African continent.”

Fintech leaders name for inter-African cooperation

The transfer is a big one because it comes at a time when extra fintech leaders are calling for higher inter-African cooperation to drive the trade ahead. On the Inclusive Fintech Discussion board in Kigali final month, Dare Okoudjou, CEO of pan-African funds firm MFS Africa, informed African Enterprise that African international locations must combine their fintech markets with the intention to unleash its full financial potential. He known as for passporting options to minimise authorized and regulatory limitations.

“We have to give entrepreneurs throughout the continent entry to a much bigger market. We hold speaking about this potential market of 1.2bn folks. However it isn’t a actuality till we truly make it,” he stated.

Whereas this ambition stays a good distance off, the Nigeria-Egypt Fintech Bridge would seem like a step in the precise route. Ophi says that Nigeria specifically seems to be ready to advance its fintech market, each via overseas collaboration and different measures. He notes that “in Nigeria, the federal government gave banking licences to telecoms corporations to encourage cellular banking in a rustic the place 36% of persons are nonetheless utterly excluded [from the formal financial sector]” but in addition emphasises that the MOU will not be ample in itself: “extra steps to advance the fintech market could be welcomed.”

Ophi is assured that the Nigeria-Egypt Fintech Bridge may unlock vital quantities of cross-border collaboration and assist entrepreneurs in each international locations devise extra refined fintech providers and merchandise – and subsequently promote wider financial development.

“The MOU will permit Nigeria and Egypt to draw improvements and overseas direct funding, which in flip will assist develop the economies of each international locations,” he says.