ABUJA, Nigeria (VOICE OF NAIJA)- Nigeria’s fintech industry, regarded as one of the fastest growing in Africa, continues to rely heavily on foreign capital, a situation that leaves it exposed to volatility in global markets, according to the Central Bank of Nigeria’s 2025 Fintech Policy Insight Report.
The report disclosed that Nigerian startups secured $520m in equity funding in 2024, a decline from about $747m in 2019, when the country accounted for nearly 37 per cent of total startup investments across Africa.
While the sector has remained resilient amid global economic pressures, the CBN cautioned that strong dependence on external funding increases its vulnerability to market fluctuations.
Despite pronounced global macroeconomic gyrations, the report said this performance reinforces Nigeria’s status as a major centre for financial innovation.
It added that the sharp increase in interest rates in advanced economies in 2022 contributed significantly to the slowdown in venture capital inflows.
READ ALSO: OPay Receives CBN’s Financial Inclusion Innovation Award
“These dynamics highlight the importance of developing domestic funding avenues, such as leveraging Nigeria’s capital markets, to reduce currency risk and sustain fintech growth,” the apex bank stated.
CBN Governor, Olayemi Cardoso, said the country is experiencing a rapid and transformative shift in its financial sector. Over the last decade, Nigeria’s fintech space has evolved from just a few startups into one of the continent’s most dynamic innovation ecosystems.
“Even amid global economic headwinds, Nigerian fintech firms continued to attract investment and drive change. Today, with improved stability of our currency and domestic economy, it is clearer than ever that financial innovation can advance inclusion at scale,” he said in comments accompanying the report.
Beyond funding concerns, the central bank highlighted Nigeria’s leadership in digital financial infrastructure.
It noted that more than 25 per cent of electronic transactions in Africa’s most populous country are processed through real-time payment channels, with nearly 11 billion transactions completed in 2024, compared with five billion in 2022.
The report described Nigeria’s instant payments platform, NIBSS NIP, as one of the most advanced and widely adopted globally.
The CBN also stressed the need to reinforce system integrity and credibility, identifying compliance reforms, enhanced anti-money laundering oversight, and stronger consumer protection measures as critical to sustaining investor confidence.
READ ALSO: CBN’s $1bn Remittance Goal Faces Global Policy Storm
By prioritising domestic funding, regulatory modernisation, and innovation infrastructure, the central bank said it aims to position Nigeria not only as a fintech leader but also as a regulatory reference point whose lessons are applicable to other emerging and high-growth economies worldwide.
Stakeholders surveyed by the CBN identified compliance costs as a major constraint to innovation.
The report revealed that 87.5 per cent of respondents said the expense of meeting regulatory and risk requirements significantly limits their ability to innovate, while prolonged product approval processes and regulatory timelines were also cited as key obstacles.
The report further noted that 62.5 per cent of fintech firms intend to pursue regional expansion, with strong backing for regulatory passporting frameworks to support compliant entry into other African markets.
However, the CBN warned that successful cross-border growth depends on a stable funding base and coordinated regulatory oversight.