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Senate moves to amend 29-yr-old banking law

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As part of the legislative process to amend the Banks and Other Financial Institutions Act, the Senate, on Tuesday, debated the bill seeking to amendment of the 29 year Act.

The bill was co-sponsored by Senators Uba Sani (Kaduna Central) and Betty Appiafi (Rivers West).

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Senate

Leading debates on the general principles of the bill on behalf of the sponsors, Senator Uba Sani stated that the aim of the amendment is to update and strengthen the existing Act to effectively address the challenges being faced in the finance services sector in Nigeria in line with global best practices.

Senator Sani explained that while in other countries like South Africa and Egypt, the laws regulating banking and other financial institution are regularly updated, in Nigeria the law that was enacted almost 30 years ago has remained in force.

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According to the distinguished Senator, the objectives of the bill includes – to update the laws governing Banks, Financial Institutions and Financial Services Companies; enhance efficiency in the process of obtaining/granting banking licences; accurately delineate the regulatory functions of the Central Bank of Nigeria in the financial services industry; update and incorporate the laws for enacting.

Others include licencing and regulation of micro-finance banks; regulate the activities of financial technology companies (FINTECHs); and update commensurate penalties for regulatory breaches in the financial services sector.

According to him, when passed eventually, the bill will strengthen the legal framework for the regulation of banks to prevent distress especially in turbulent periods like COVID-19 so that the country can adequately prepare and deal with potential post COVID-19 challenges in the banking sector.

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Ihesiulo Grace

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