As a result of its capability to jeopardise the efficacy of safety-net arrangements and prudential roles of the traditional banking system, such that its basic functions become only available to a smaller segment of the banking system, the Nigerian Deposit Insurance Corporation (NDIC) has expressed concern over the evolution of digital currencies.
Speaking at the 3rd NDIC-forum organised for editors in Lagos, yesterday, the NDIC Managing Director/Chief Executive, Umaru Ibrahim, said the evolution of virtual currencies has proved beyond reasonable doubt that the challenges faced by regulators of financial systems differ remarkably from those they confronted few years ago.
He said: “The partial dis-intermediation of the banking system arising from proliferation of digital currencies such as bitcoin, as well as the activities of FinTechs are all of critical concern to the corporation.”
The NDIC boss explained that the entire fabric of the global financial stability is also currently under siege by one form of crisis or the other but noted that of critical concern to the corporation is the issue of evolution of virtual currencies.
Continuing, Ibrahim pointed out that the objective of the editors’ forum is to seek the critical buy-in of decision-makers in the boardrooms of media houses as the corporation seeks to sensitise Nigerians on its activities through a variety of hybrid initiatives across multiple platforms.
Hear him: “We have pursued the relentless improvement of our human capital and also overhauled our internal business processes for effective performance. In May 2018, the British Standard Institute (BSI), after a rigorous process, duly certified the corporation on Information Security Management (ISO/IEC 27001:2013, IT Service Management System (ISO/IEC 200001:2011) and the Business Continuity Management System 1S0/22301: 2012). The NDIC was the first public sector institution in Nigeria to receive all three certifications simultaneously.”
He also disclosed that the NDIC, in close collaboration with the Central Bank of Nigeria (CBN) and other key players in the nation’s financial system, are working on several initiatives to accelerate financial literacy and financial inclusion, especially among rural communities nationwide.
“One of the intended goals of the strategy is to reduce the adult financial illiteracy rate in Nigeria to below 20 per cent by the year 2020.”
On the defunct Skye Bank, Ibrahim said the corporation responded with the establishment of Bridge Bank called Polaris Bank to assume the assets and liabilities of the closed bank.
“The resolution option adopted by the corporation not only guaranteed the seamless and continuous operation of 277 branches of the closed bank under the name of the bridge bank, it also saved over 6,000 jobs that could have been lost.
“It also enabled depositors to have unhindered access to their funds in excess of N949.60 billion as at June 2018,” he said.