The fintech sector in Nigeria is divided regarding regulations, as revealed by a recent survey conducted by the Central Bank of Nigeria (CBN). According to the survey, 50% of fintech companies believe that regulations promote innovation, while the remaining 50% feel that these rules hinder their progress.

This insight comes from the CBN Fintech Report 2025, which was published recently. The report is based on a nationwide survey that looked into the fintech sector, along with feedback from a workshop with industry stakeholders and a discussion held by the CBN in the latter part of 2025.

The CBN notes that this divide reflects ongoing worries among businesses about problems such as slow license approvals, unclear rules, and inconsistent enforcement of regulations. While there have been some improvements in communication between regulators and fintech companies, many of these issues remain unresolved.

According to the report, 50% of the respondents see the regulatory environment as beneficial, while the other half views it as a limitation. This difference in opinion largely stems from frustrations over lengthy license approval times, vague guidelines, and uneven application of the rules.

Additionally, the processes required to comply with regulations are seen as hurdles to innovation. About 62.5% of the companies surveyed stated that long approval times significantly delay the launch of new products. More than a third of them reported that it takes over a year to introduce a new product, primarily due to challenges related to compliance with the regulations.

Compliance costs also pose a major obstacle. Approximately 87.5% of fintech businesses reported that expenses tied to meeting regulatory requirements and managing risks limit their ability to innovate. This is particularly true for costs related to preventing money laundering, ensuring cybersecurity, and implementing fraud prevention measures.

While firms acknowledged the necessity of these safeguards, many complained that fragmented supervision and duplicative reporting inflate costs, especially for smaller or fast-growing companies.

The report found a strong interest maintained with regulators, with around 75% of those surveyed agreeing that regular meetings to talk about these issues would be helpful.

All the companies are eager to team up through programs called regulatory sandboxes and working groups, which are designed to make it easier to communicate with regulators.

Aiming to grow in the region is a major goal, with 62.5% of companies either already operating in or planning to enter more African markets. However, they find the different licensing systems in each country to be a hurdle for their growth.

Participants also showed interest in a system that would let licenses from Nigeria be accepted in other countries like Ghana, Kenya, South Africa, Uganda, and Senegal.

While fintech companies appreciated Nigeria’s advanced real-time payment system, they mentioned several problems that make it hard to expand and include more people. These problems include limited access to affordable digital identity checks, difficulties in sharing important information, and unreliable internet service. The report also pointed out an increase in transaction failures and service interruptions during the busy time known as “Detty December.”

On cryptocurrency, Operators in the financial industry acknowledged its potential for cheaper cross-border payments, improving access to banking services for more people. They believe that regulations should focus on the specific risks associated with cryptocurrencies rather than imposing strict rules that could stifle growth. There’s a strong call for clearer regulations and better cooperation between countries, especially since a significant number of respondents reported challenges in securing funding due to economic uncertainty and delays in investments.

To tackle these issues, a large majority—87.5%—support creating special funds or guarantees for fintech companies through partnerships between the government and private businesses. The report found that 87.5% of fintech companies in Nigeria are using artificial intelligence (AI) to help detect fraud, while 62.5% are using AI chatbots to improve customer service. The Central Bank of Nigeria noted that even though nearly 11 billion payment transactions were processed in 2024, problems like fraud and weak controls are still significant concerns.

Despite these challenges, 62.5% of fintech companies showed interest in participating in a special program that focuses on AI, and 75% of them emphasized the importance of using AI ethically, especially when making decisions related to credit and risk management.

The Central Bank of Nigeria (CBN) has highlighted both the progress and the challenges still facing Nigeria’s fintech sector. In the report’s introduction, CBN Governor Olayemi Cardoso shared that the bank has seen how digital finance can change lives by helping more people participate in the economy, creating jobs, and improving living standards for many Nigerians.

He stressed that while it’s important to encourage innovation in fintech, it should be done carefully. He stated that protecting the financial system’s integrity, ensuring good governance, safeguarding consumers, and managing risks are also very important.

Cardoso noted that Nigeria wants to find a good balance where innovation can drive growth while keeping the financial system stable and maintaining public trust. This approach aims to make Nigeria a leader in fintech not just in Africa but also on a global scale.

In a statement released after the survey was made public, the CBN emphasized that the report showcases Nigeria’s strengths in real-time payments and views fintech innovation as a valuable addition to the financial system. This innovation helps to make financial services more accessible and efficient while ensuring stability.

The CBN said that the report provides useful guidelines for improving regulatory coordination, enhancing oversight, and encouraging responsible innovation. This will serve as a resource for all stakeholders as Nigeria works to strengthen its role in the fintech industry both regionally and globally.