Eunice Yaa CUDJOE’s thoughts…..Regulatory compliance amid Rising FinTechs


The digitalisation of financial services has been on the rise globally – partly to support the financial inclusion agenda as well as to address the changing needs of customers. This call to advance financial inclusion across the globe, especially in developing and emerging economies, has rendered the issue of regulatory compliance and Fintech a more topical one in the business space.

Regulatory compliance in the financial sector implies strict adherence to policies and regulations surrounding the regulatory and supervisory environment of financial institutions. This includes, but is not limited to, compliance with Anti-Money Laundering (AML), Anti-Terrorist Financing (ATF), Corruption policies, among others. Fintech on the other hand simply means the application of technology to finance. FinTech is the short form of financial technology.

FinTechs seek to harness the rapid growth in technology to transform the global financial ecosystem. The emergence of FinTechs has highlighted the need for digitalisation as well as the importance of data in the economy. Never in the history of the world has technological innovation been so central to financial markets development than this current dispensation.

The emergence of FinTechs has brought profound changes in the traditional banking business model. This includes but is not limited to changes in money transfers, business and personal loans, payment and settlement systems; how investment is done, financial advisory services among others. In Ghana, some notable FinTech start-ups include Express Pay, ZeePay, Hubtel, Paysail, DigiTeller, etc. In this article, I highlight the need for heightened regulatory compliance by financial institutions, FinTech start-ups and relevant stakeholders in building an enabling and thriving FinTech ecosystem for better financial inclusion.

Who are stakeholders in the FinTech ecosystem?

The FinTech network consists of diverse groups of institutions and individuals which interact to build an enabling FinTech environment. They include regulatory and legal bodies, financial institutions, venture capital, FinTech companies, investors, infrastructure providers, consumers, mobile network operators, academia, consulting firms and legal advisors, international knowledge partners, etc.

Each of these institutions play essential roles critical to survival of the FinTech environment. Thus, the peaceful co-existence of these institutions is very imperative for the development of a thriving FinTech ecosystem. The key role of FinTech is to explore and design innovative financial solutions that address changing customer needs in this technology-driven world. Financial institutions and venture capital provide funding for FinTech start-ups. The regulatory and legal bodies create an enabling regulatory and legal framework to support operations of the FinTechs. The other stakeholders perform diverse roles ranging from guidance and advisory services to support services, etc.

The regulator’s roles in development of FinTech

Success of the FinTech ecosystem to a large extent depends on the existence of adequate and robust regulatory and supervisory frameworks that will regulate and monitor activities of these FinTechs. The Bank of Ghana, the regulatory body for financial institutions, is therefore at the heart of success for the FinTech ecosystem in Ghana. To properly navigate through the Fintech environment, it is most essential for the regulator to evaluate the adequacy of its existing organisational structure to support its regulatory activities.

This has engendered global reforms among some regulators and supervisory bodies to better position them for their roles in this ever-changing FinTech space, of which the Bank of Ghana is no exception. Acknowledging the complexities as a result of the FinTechs’ emergence, it was refreshing to learn that on 5th May 2020, in a press release, the Bank of Ghana announced the establishment of a new FinTech and Innovation Office to drive the Bank’s cash-lite, e-payments and digitisation agenda.

The Bank of Ghana opined that the new FinTech and Innovation Office will be responsible for licencing and oversight of dedicated electronic money issuers (mobile money operators), payment service providers (PSPs), closed loop payment products, payment support solutions and other emerging forms of payment delivered by non-bank entities. This development comes on the back of several interventions in the payment and settlement space, such as the mobile money interoperability services and so forth.

In a recent development geared toward deepening financial inclusion and affirming the Bank of Ghana’s commitment in creating enabling the FinTech environment, the Bank of Ghana issued its first dedicated electronic money issuer licence to ZeePay Ghana Limited – a local Fintech. I believe this development will pave the way for more local FinTechs with the requisite capacity to spring up in the not too distant future.

Enhancing Regulatory Capacity for Better FinTech Supervision

Building and developing the skill set and capacity of the regulator is a useful way of keeping the regulator abreast with developments in the field for better regulatory and supervisory frameworks.

To keep pace with the ever-evolving FinTech, it is very needful to build new capacity among regulators to embrace the culture of change and innovation. Aside from establishment of the dedicated FinTech and Innovation Unit, the Bank of Ghana should continuously train and develop the skill set of its staff – especially those in the new FinTech and Innovation Unit, to equip them with the requisite skills for its activities. Continuous professional development in the field of FinTech and related technical skills should be a top priority.

Regulating innovation in the financial sector presents regulators with the challenging task of balancing several competing priorities; such as market growth, market discipline and overall financial stability. The Bank of Ghana should capitalise on regulatory technology for better supervision of the FinTechs’ activities.

Regulatory technology, which is simply known as RegTech, involves the application of digital technology to improve the regulatory processes. RegTech is an emerging field in regulatory compliance resulting from the emergence of FinTechs. RegTech seeks to digitise the operation of routine compliance processes such as know your customer (KYC), customer due diligence (CDD), enhanced due diligence (EDD), regular review (RR) among others. RegTech provides digital information technology to streamline activities of the compliance department – right from the initial client engagement till clients are off-boarded.

Also, it offers innovative solutions for online monitoring and routine surveillance of financial institutions’ activities. Notwithstanding the cost-intensive nature of this digital transformation, I believe it is a worthy investment as the potential benefits are enormous. Research has shown that regulators are usually a step behind the evolution of technology. Though the Bank of Ghana has made significant progress in this regard, technology is dynamic and not static; it is therefore necessary that there is continuous monitoring and investment in regulatory technology. Some financial institutions have also upgraded their systems to meet the International Standard Organisation (ISO) requirement.

Also, most financial institutions have upgraded their online payment network and become Payment Card Industry Data Security Standard (PCI DSS) certified. The likes of Guaranty Trust Bank, Zenith Bank, CalBank, Access Bank, First Atlantic Bank and others have met PCI DSS certification – a welcome development for the digital transformation agenda. Others who are yet to meet this international certification standard should be encouraged to do so for their utmost benefit and better customer experience.

Moreover, the Bank of Ghana should champion and support the spread of digital financial literacy across the country. Digital financial literacy means having the required skills and knowledge to effectively use digital gadgets for financial transactions. One must be digitally and technologically savvy to better appreciate and enjoy the products and services rendered by these FinTechs.

It is common knowledge that the advancement in digitalised financial services presents high cybersecurity risks – such as online payment fraud, hacking, among others. Individuals who in one way or another become victims of these cybersecurity attacks may be discouraged from further use of digital services, which can culminate in financial exclusion.

It is therefore necessary to sensitise citizens and the general public on digital financial literacy, using the various media platforms such as social media, the print media, television stations and radio stations. In this way, a vast majority of the population can be reached and made aware of the wind of change brought about by emergence of the FinTechs. Financial institutions should also actively partake in this regard, by continuously educating their customers on effective use of online systems and platforms provided by their FinTech partners.

Stakeholder engagement by the regulator is also another important way of gaining a broader perspective of the activities of these FinTechs for better regulation and supervision. Through dialogue with all relevant stakeholders in the FinTech ecosystem, the Bank of Ghana will understand the FinTech innovation and risk-profiling in their activities, helping them to develop effective policies to regulate their activities.


To conclude, the new phase of FinTech has come to stay, and it is very essential for all stakeholders to be agile to leverage on the numerous benefits. Nevertheless, this development presents some risks, which calls for adequate collaboration with all relevant stakeholders. While financial institutions are admonished to form strategic partnerships with these FinTechs for mutual benefit, the Bank of Ghana should continue to invest heavily in regulatory technology to build enabling regulatory frameworks for FinTechs.


About the Author:

Eunice Yaa Cudjoe is an Associate Member of the Institute of Chartered Accountants Ghana (ICAG) with years of experience in audit. She is a Bachelor of Commerce Degree holder from the University of Cape Coast and currently a final year Master student in International Audit, Economics and Finance at UCA in France. She is also a Client Lifecycle Management (CLM) intern at Deutsche Bank Luxembourg.

Email: [email protected]


Disclaimer: The views expressed in this article are exclusive to the author and do not represent those of her institutions and professional body. I can be reached via my stated contact where necessary.

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