The Central Bank of Nigeria (CBN) has directed financial institutions and payment service providers to do more to improve transparency and proper disclosure of Digital Financial Services (DFS).
Following the growing threats to cybersecurity in recent times, the Central Bank of Nigeria, (CBN) also directed the other financial institutions under its regulation to boost their fraud prevention and risk management capabilities by providing fraud prevention messages and tips for consumers using both audio and virtual modes of communication in local languages to monitor fraud reports to identify emerging fraud issues and enlighten their customers on how they can protect their money.
This was made known through the bank ‘Exposure Draft on Digital Financial Services Awareness Guidelines,’ which will address the issue of security of digital services, DFS, with effective potential to expand access to financial services in Nigeria population.
In other to ensure consumer understanding, good treatment, and positive outcomes, the guidelines provided for a set of principles and expectations for financial service providers to integrate into the provision of DFS.
The framework also seeks to set Digital Financial Literacy (DFL) standards for Digital Financial Services Providers (DFSP), align product development, promotion, and consumer awareness to DFS amongst DFSP, enhance transparency and proper disclosure on DFS as well as provide for the development of financial literacy and consumer education materials on DFS.
The guidelines also stated that DFS providers shall henceforth disclose all terms, conditions, fees, and other associated charges on product offerings prior to enrollment, ensure integration of data privacy and protection standards into internal policies and conduct evidence-based awareness campaigns to sensitise consumers on how to protect their assets and sensitive details and develop default settings on DFS which are by nature “opt-out” not “opt-in” of data sharing with third parties, and clear and simple “opt-in” language for sharing of data, as well as ensure privacy to data collection and sharing during the product enrollment.
The Central Bank of Nigeria, (CBN) further directed Digital Service Providers to provide strategies to assess their policies on raising consumer awareness and product usage; to be forwarded to the Director of Consumer Protection, CBN bi-annually for review.
The apex bank also requested the DFS providers to forward monthly returns on consumer awareness mechanism conducted to the Director, Consumer Protection, CBN.