By Erewunmi Peace

The Central Bank of Nigeria (CBN) has expressed concern over the Nigerian fintech sector’s growing dependence on foreign funding, warning that such reliance could expose the industry to global market fluctuations and foreign exchange risks.

According to the CBN’s latest fintech policy insight report, while Nigeria’s fintech ecosystem has experienced significant growth, much of the expansion is fueled by foreign investors and external capital rather than domestic sources.

The apex bank highlighted that this dependence could make fintech firms vulnerable to global economic shocks, especially if foreign investments decline or international financial conditions become unfavorable. The report also noted a decrease in equity funding from foreign investors in recent years, underscoring the need for stronger domestic capital solutions.

To address these risks, the CBN urged fintech companies to explore local funding avenues, including the Nigerian capital markets, to reduce exposure to external shocks and strengthen financial resilience. The bank emphasized that sustainable growth in the fintech sector must balance foreign investment with robust domestic financing structures.

Industry analysts say the warning is timely, as Nigeria’s fintech sector remains a key driver of financial inclusion, innovation, and employment in the country. Reducing over-reliance on foreign capital is seen as essential for long-term stability and growth.

The CBN’s advisory underscores the need for proactive measures to safeguard the sector’s growth trajectory while minimizing vulnerabilities arising from global financial uncertainties.