Lagos, Nigeria, 15 October 2026 – Nigeria’s banking industry has demonstrated its ability to raise capital, build digital infrastructure and process payments at scale. Its next challenge is to translate those capabilities into greater economic productivity, more useful financial services and stronger protection for customers and businesses.

At TAB Global’s Finance West Africa 2026 conference in Lagos on 14 October, banking, payments and technology executives questioned whether stronger balance sheets would produce more productive lending, why regional payments remained difficult despite Nigeria’s advanced domestic infrastructure, and how institutions could serve customers who generated relatively little revenue.

Artificial intelligence (AI) is adding another dimension to these challenges, offering more sophisticated fraud detection while enabling increasingly convincing attacks. Banks and fintech companies are also competing more directly for customers and financial relationships, even as they continue to depend on one another’s infrastructure and capabilities. The conference was co-hosted by First Bank of Nigeria.

Recapitalisation raises the question of where capital will go

Stephen Ohiomoba, Head of IT Governance and Service Delivery at the Nigeria Inter-Bank Settlement System (NIBSS), placed Nigeria’s banking recapitalisation within the government’s ambition to build a $1 trillion economy by 2030.

Delivering the keynote on behalf of Premier Oiwoh, Managing Director and Chief Executive Officer of NIBSS, Ohiomoba reported that 33 banks had raised NGN 4.65 trillion (about $3.5 billion) in fresh capital, with nearly 75% contributed by domestic investors.

“The new capital our banks have raised was not raised for its own sake,” he said.

Ohiomoba linked the additional capital to more productive lending, particularly to small businesses, agriculture, manufacturing and infrastructure. He identified three priorities through 2030: deploying capital for economic impact, embedding resilience and compliance into everyday banking, and extracting greater value from shared financial infrastructure.

Foo Boon Ping, President and Managing Editor of TAB Global, questioned whether banks would direct additional resources into productive lending or continue to find government securities more attractive than financing small and medium-sized enterprises. He asked whether better data could help overcome barriers to assessing and managing lending risks, arguing that banking scale should be judged by its contribution to economic activity, including businesses’ ability to release working capital, reduce financing costs and reinvest in productive activity.

Ohiomoba identified data as an important consideration, alongside regulation, institutional frameworks and corporate governance. He argued that banks would pursue commercially attractive opportunities and that richer transaction information could improve risk assessment and product development.

Recapitalisation increases banks’ lending capacity but does not remove the need for reliable borrower information, commercially viable opportunities and effective credit controls.

Ohiomoba also reported that NIBSS’s National Payment Stack had crossed 100 million successful transactions by September 2026.

He explained that its adoption of ISO 20022 messaging standards provided participating institutions with richer, more standardised transaction information, potentially supporting better reconciliation, risk analysis and financial product development.

Digital transformation must deliver outcomes customers can rely on

Ebenezer Akinyemi, Chief Digital Officer of Abbey Bank, described the institution’s transition from mortgage banking towards commercial banking.

He explained that the bank had begun testing commercial banking activities and investing in systems capable of handling greater transaction volumes before expanding its operations. The transition required reliable processing, effective responses to service failures and the ability to meet customers’ expectations of immediate digital services.

For Abbey Bank, technology investment needed to support a different business model and customer proposition rather than simply provide a new digital interface.

Tavonga Muchuchuti, Managing Partner of Xavier Africa, recognised Nigeria’s achievements in domestic real-time payments and argued that other African markets could learn from its experience.

However, he questioned whether banks were converting technological capabilities into sufficiently useful customer outcomes.

Customers were primarily concerned with reliable services and access to financing rather than the technology architectures banks deployed, he argued.

Muchuchuti pointed to lending approaches in other African markets that made greater use of transaction activity and other borrower information to assess small businesses lacking conventional collateral or extensive credit histories.

Such approaches could make more borrowers visible to lenders without requiring banks to abandon credit discipline. The commercial value of digital transformation ultimately depends on whether it improves service, reduces operating costs and enables financing that would otherwise be difficult to provide.

Who will serve Nigeria’s next 40 million potential customers?

The prospect of bringing another 40 million people into more active participation in financial services raises a fundamental question: who are they, and what services do they actually need?

Moderating the financial inclusion session, Akinyemi distinguished access to financial services from regular usage, customer loyalty and profitability.

Daniel Awe, Head of Africa Fintech Foundry, compared banking with mobile phones, arguing that financial services needed to become similarly relevant to everyday life.

He questioned whether customers could depend on transfers reaching their recipients, transparent charges and timely resolution of service failures. Without confidence in these basic functions, opening accounts would not necessarily lead to regular usage.

Sunday Olaniyan, Head of E-Business at SunTrust Bank, reinforced this concern, describing a deficit of confidence as a major barrier to participation.

Referring to estimates that about 79% of Nigerian adults had access to financial services, he questioned whether access translated into reliable service and active participation. He emphasised simplicity, dependability and services designed around customers’ needs.

Omowunmi Odumusi, Head of Public Sector Payments and Partnerships at Wema Bank, focused on relevance and customer education.

Drawing on her experience of digitising government-related payments, she explained that adoption depended on demonstrating how digital services could solve familiar problems. Customers were more likely to change established practices when they understood the benefits and could use the services confidently.

Babafemi Oluyemi, Head of Online Banking at First Bank of Nigeria, argued that customers had different needs and motivations, making uniform product offerings inadequate.

He proposed making greater use of agency banking networks for customer education rather than limiting agents to cash-in and cash-out transactions. Agents embedded in local communities could explain products in familiar languages and help customers use services without visiting branches.

Oluyemi also raised the difficulty of recovering smaller loans and suggested more consistent identification across customers’ financial and other activities to support credit assessment and recovery. Such an approach would require safeguards governing the collection, sharing and use of personal information.

Akinyemi questioned why banks would pursue customers with small balances and low transaction values when established corporate banking relationships could be considerably more profitable.

He contrasted lending to a creditworthy blue-chip company with the difficulty of disbursing and recovering numerous smaller loans, asking what would have to change for banks to serve these customers profitably.

Awe argued that banks would need substantially lower-cost operating models, including agency banking, customer acquisition through existing communities, automation and more efficient transaction processing and problem resolution.

Oluremi Tinuolu-Gabriel, Director of Retail and Digital Businesses at United Capital, challenged the premise of the 40 million figure more directly.

He questioned who these potential customers actually were, arguing that corporate employees and students generally already needed accounts to receive salaries or financial support.

He also questioned whether the absence of a conventional bank account necessarily meant that someone lacked useful financial services. Some people had little money to deposit and no compelling reason to maintain an account. Their immediate need might be to transact rather than establish a formal banking relationship.

Tinuolu-Gabriel urged institutions to understand how people earned, spent and moved money. He cited a fintech provider that had attracted customers through services associated with everyday activities, including commuting, food purchases and betting, rather than beginning with conventional banking products.

He questioned whether the industry should begin by asking who would bank the next 40 million or what services would give them a reason to participate. He also challenged whether expanding access and serving these customers profitably could always be achieved through the same business model.

An audience participant pointed to local government areas without commercial bank branches, the concentration of banking services in urban areas and concerns about cybercrime.

People outside conventional banking are not a uniform group. Some have limited income or little demand for traditional accounts; others face genuine barriers to accessing suitable services. Expanding meaningful participation requires understanding these differences and developing operating models that can serve them sustainably.

Banks and fintechs compete over the customer relationship

Banks and fintech companies increasingly compete for customer relationships even as they depend on one another’s capabilities and infrastructure.

Olaniyan acknowledged that fintech companies had challenged banks and taken business from them, but argued that collaboration offered opportunities for participants with different regulatory roles and capabilities.

Banks could work with fintechs and telecommunications companies while retaining strengths in lending and other services requiring banking licences.

Odumusi was more sceptical about the balance of competition and collaboration.

She argued that fintech companies, having initially depended on banks and their infrastructure, had increasingly become competitors for customers and transactions. Banks needed to recognise that challenge rather than assume collaboration would preserve their position.

Tinuolu-Gabriel questioned the assumption that customers would continue to regard banks as the natural destination for their funds.

Drawing on his experience in capital markets, he said investment flows received from fintech platforms could exceed those originating through banks, challenging banks’ historical advantages in trust and customer relationships.

Awe argued that successful institutions would need to become effective ecosystem orchestrators, connecting services and partners around customers’ everyday needs.

The competitive stakes extend beyond payment transactions to customer engagement, financial information, distribution and the opportunity to provide additional services. Partnerships remain commercially important but do not eliminate competition over these relationships.

Cross-border payments expose the limits of domestic success

Nigeria’s domestic payment infrastructure enables customers to transfer money with relative ease, but cross-border transactions continue to face uncertainty over settlement, liquidity and the availability of funds.

Moderating the cross-border payments session, Muchuchuti questioned why a business could make domestic transfers quickly but face considerably greater difficulty when paying a supplier in another African country.

Michael Oluwaseun Ogundolapo, Head of Trade, Transaction Banking at Stanbic IBTC Bank, explained that domestic payments benefited from shared infrastructure operating within a common regulatory environment.

Cross-border transactions involved multiple institutions, jurisdictions, regulatory requirements and sources of liquidity.

He distinguished confirmation that a payer had been debited from the point at which the recipient obtained usable funds. A Nigerian business might receive confirmation that a payment had been initiated successfully, while its supplier in another African country could still be waiting for funds.

That delay could affect the release of goods, working capital and the certainty with which businesses managed their obligations.

Ogundolapo explained that correspondent banking relationships supported activities beyond payment processing. Banks had invested in these relationships over many years and could not be expected to abandon them simply because new infrastructure had become available.

He recognised the achievements of the Pan-African Payment and Settlement System (PAPSS), while acknowledging that its adoption and usage had not yet reached the levels the industry might ultimately expect.

Muchuchuti questioned whether banks’ commercial incentives were sufficiently aligned with customers’ desire for faster and cheaper cross-border transactions.

Abayomi Olomu, Head of Payment Business at Wema Bank, identified regulatory controls, documentation requirements and transaction limits as constraints on using new arrangements for larger trade-related payments.

Ogundolapo agreed that these constraints mattered but stressed the need for payment relationships to develop transaction histories, confidence and controls over time. New arrangements could not necessarily begin with the same transaction volumes or risk limits as established correspondent banking relationships.

Muchuchuti also challenged the banks over competition from stablecoin-based and other digital-asset payment services, questioning why businesses would continue using conventional channels if alternatives delivered faster or more convenient transactions.

Ogundolapo argued that Nigerian banks possessed the technical capabilities to develop competitive services but remained subject to Central Bank of Nigeria requirements. He distinguished banks’ regulatory position from that of providers operating under different licensing arrangements.

Payment innovation is advancing across different types of institutions, but their regulatory obligations, commercial incentives and settlement capabilities are not identical.

For businesses, the value of cross-border payments ultimately depends on greater certainty over foreign exchange, transaction costs, documentation, settlement and when recipients can use their funds.

AI-driven fraud demands stronger intelligence sharing and governance

AI is changing both the capabilities available to banks and the methods used by financial criminals, raising questions about whether institutions can defend transactions extending across multiple organisations and technology providers.

Frances Undelikwo, Chief Information Security Officer and Data Protection Officer at NOVA Bank, argued that AI benefited both attackers and defenders.

Criminals could use it to produce convincing communications and execute attacks more quickly, while banks could apply the same technology to detect suspicious behaviour. Traditional fraud-awareness advice, such as looking for poorly written messages, had become less dependable because AI could generate credible content almost instantly.

Olusesan Ajayi, Chief Risk Officer at Keystone Bank, stressed that deploying AI effectively required institutions to understand its capabilities, limitations and risks.

He pointed to increasingly sophisticated phishing attempts and warned that pursuing efficiency without appropriate controls could expose banks to serious losses.

Echezona Agubata, Chief Technology Officer at Coronation Merchant Bank, emphasised the importance of data in identifying fraudulent behaviour.

Understanding customers’ normal transaction patterns and routines could help institutions recognise anomalies, he argued. However, Nigerian banks’ dependence on AI models developed outside the country raised concerns about technological sovereignty and control over information.

Greater use of behavioural data also introduced questions about privacy, consent and the limits of monitoring.

Moderating the session, Foo questioned whether banks should share fraud warnings and suspicious patterns, and how they could do so without compromising customer information.

Agubata described an incident involving an application used by multiple banks that had been compromised. Intelligence shared between individuals at different institutions enabled another bank to identify warning signs and take protective action.

He said formal channels for sharing cyber-threat intelligence already existed, including arrangements involving chief information security officers. These enabled institutions to exchange attack patterns and technical indicators without disclosing customer-specific information.

However, he acknowledged that some banks remained reluctant to disclose vulnerabilities, particularly when incidents exposed weaknesses that should have been addressed.

Gbenga Gbemileke, Chief Information Officer and Divisional Head of Technology and Digital Banking at TATUM Bank, proposed extending AI-enabled fraud monitoring beyond individual banks.

Fraudulent funds frequently moved between institutions, making it difficult for any single bank to understand the full sequence of activity, he argued.

An ecosystem-wide approach could analyse originating and receiving accounts, account histories, identification information and suspicious transaction patterns.

This remained a proposal rather than an established industry-wide capability. Its implementation would require agreement on data sharing, governance and responsibility for decisions affecting transactions across institutions.

Ajayi placed particular emphasis on the responsibilities of bank boards and senior management.

He warned that institutions needed to understand how AI systems operated, the risks associated with their use and the consequences of failures. Increasingly virtual banking relationships also complicated customer verification and know-your-customer controls.

Asked whether banks were ready to use AI for live decisions rather than primarily as a decision-support tool, Ajayi emphasised the importance of defining the technology’s intended use, acceptable risks and control parameters.

Undelikwo also highlighted a structural weakness in financial sector defences.

Individual institutions generally focused on protecting their own systems, while attackers could exploit vulnerabilities across banks, fintech companies, merchants, identity providers and other participants involved in a transaction.

Stronger coordination across the financial ecosystem, alongside controls within individual institutions, would therefore be essential.

AI offers banks more powerful tools for detecting suspicious behaviour, but its contribution to financial security will depend on data quality, institutional controls, intelligence sharing and accountability for automated decisions.

Turning financial capacity into economic value

Nigeria’s banking industry faces a common challenge across capital allocation, financial inclusion, regional payments and cybersecurity: institutions must move beyond expanding their financial and technological capacity to demonstrating how that capacity improves economic outcomes.

Recapitalisation will matter if banks can finance more productive businesses without compromising credit discipline. Financial inclusion will matter if customers have services they need and can afford to use. Cross-border payment innovation will matter if businesses receive usable funds with greater certainty. AI will matter if institutions can improve security and efficiency without weakening accountability or trust.

Nigeria has demonstrated that its banking industry can raise capital and build digital infrastructure at scale. The harder test is whether those capabilities translate into sustained economic value.