Daniel Adaji
The Central Bank of Nigeria and the Financial Regulation Advisory Council of Experts (FRACE) have reaffirmed their commitment to strengthening governance, regulatory oversight, and risk management in Nigeria’s non-interest financial services industry to sustain public confidence and financial stability.
The commitment was reiterated during the 2nd Annual Interactive Session between the CBN Financial Regulation Advisory Council of Experts and the Advisory Committees of Experts (ACE) of Non-Interest Financial Institutions (NIFIs), held at the CBN Auditorium in Abuja on Thursday.
Speaking at the event, the Deputy Governor, Financial System Stability at the CBN, Mr. Philip Ikeazor, said the engagement was aimed at deepening the credibility, resilience, and soundness of the non-interest financial services industry.
Represented by the Director of the Financial Policy and Regulation Department, Dr. Rita Ijeoma Sike, Ikeazor said the session built on the foundation established during the inaugural engagement and underscored the apex bank’s commitment to maintaining a sound and credible non-interest financial system.
He stated that the framework was anchored on “robust governance, effective compliance, and prudent risk management.”
According to him, Non-Interest Financial Institutions have continued to play a strategic role in Nigeria’s financial system by providing ethical and Shariah-compliant alternatives to conventional banking, while also supporting financial inclusion, real sector financing, development of Micro, Small and Medium Enterprises (MSMEs), and shared prosperity.
However, Ikeazor warned that the growing size and sophistication of the industry had exposed it to emerging risks, including non-compliance, governance lapses, operational vulnerabilities, and technological threats.
He cautioned that failure to effectively manage such risks could erode public confidence, weaken financial stability, and undermine the credibility of the non-interest finance ecosystem.
The Deputy Governor explained that the establishment of FRACE and the mandatory constitution of Advisory Committees of Experts in all NIFIs were designed to institutionalise a harmonised governance framework across the industry.
He added that continuous engagement between FRACE and ACEs remained critical to ensuring regulatory expectations were properly understood and consistently implemented.
“The objectives of today’s session include fostering the institutionalisation and effective operation of a robust Shariah governance system within Non-Interest Financial Institutions, and providing a structured platform for dialogue, knowledge-sharing, and collaboration,” he said.
In his opening remarks, the Deputy Chairman of FRACE, Prof. Bashir Aliyu Umar, said the interactive session was intended to strengthen governance within the sub-sector and create room for constructive engagement between the CBN-backed FRACE and ACEs of NIFIs.
He commended the management of the CBN for reviving the interactive forum, which was first introduced in 2014.
Earlier, Dr. Rita Ijeoma Sike reaffirmed the apex bank’s resolve to promote a strong and credible non-interest financial services industry through sound governance and regulatory oversight.
She noted that the increasing diversity of products, institutions, and delivery channels, particularly the emergence of Islamic fintech, had heightened the need for sustained dialogue and expert advisory support from scholars and practitioners.
The event also featured technical presentations on “Shariah Non-Compliance Risk in Non-Interest Banks and its Impact on the Non-Interest Financial Services Industry,” delivered by Prof. Bashir Aliyu Umar, as well as another presentation titled “Islamic Fintech and Financial Inclusion,” presented by Muhammad Kabir Muhammad and Mustapha Ishaq.
Participants at the session engaged in discussions bordering on governance challenges, risk mitigation, capacity building, independence of ACEs, and strategies for promoting innovation within the non-interest finance sector.
In his closing remarks, Prof. Abdul-Razzaq Alaro, a member of FRACE, urged stakeholders to implement the resolutions reached during the session, stressing that the value of the engagement would be measured by practical improvements across the sub-sector.
The interactive session attracted members of FRACE, chairmen and members of various ACEs, managing directors of non-interest banks, senior officials of the CBN, and representatives of institutions including the Bank of Industry and the Securities and Exchange Commission.
