Nigeria’s Reforms Must Translate National Ambitions Into Tangible Results —Experts

BY NGOZI ONYEAKUSI

Nigeria’s sweeping reforms in fintech, taxation and banking recapitalisation will be judged not by the scale of policy announcements or capital raised, but by whether they deliver measurable gains in credit, investment, production and living standards, financial journalists and analysts have warned.

The experts spoke at the annual conference of the Finance Correspondents Association of Nigeria (FICAN), held in Lagos at the weekend, with the theme, “Building on the Gains of Recapitalisation, Tax Reforms & the Fintech Revolution.”

They said the reforms had reshaped Nigeria’s economic architecture, but cautioned that their success would depend on implementation and demonstrable outcomes, including increased lending to productive sectors, stronger business activity, improved tax compliance and more reliable digital financial services.

Speaking during a panel session, Editor of Vanguard, Mr. Babajide Komolafe, described the reforms as nationally defining developments that reflected a significant change in the way Nigerians think about and interact with the economy.

Komolafe said some of the changes taking place today would have been considered impossible 10 or 15 years ago, citing the rapid growth of financial technology and digital payments as a major example.

He recalled the resistance that initially greeted the cashless policy, with individuals and businesses raising various objections to the move.

Today, he noted, digital payments have become part of everyday economic activity, extending from large corporate organisations to small businesses and artisans.

According to him, the transformation of the payments ecosystem demonstrates the ability of Nigerians to adapt to disruptive economic and technological changes.

He described the fintech revolution as evidence of the innovative, creative and daring spirit of Nigerians, noting that the same qualities have enabled Nigerians to succeed in different parts of the world.

Komolafe also identified tax reform as another major structural change.

He said the country was witnessing its first comprehensive tax reform since independence, stressing that the scale of the exercise would previously have appeared too difficult to achieve.

Despite predictions that the process would encounter significant obstacles, he said, the reform had moved from the realm of political and economic debate towards implementation.

The banking sector recapitalisation, he added, was equally significant, describing the increase in the minimum capital requirement from N50 billion to N500 billion as “mind-boggling.”

Komolafe recalled the initial concerns over how banks would raise the required funds, but noted that the institutions had subsequently mobilised the capital, with at least one bank seeking to raise as much as N2 trillion.

For him, the developments represented important markers of economic maturity and demonstrated that major reforms once considered politically or economically difficult could be undertaken.

However, another panelist, a financial writer with an international media organisation, urged caution in assessing the reforms, arguing that policy intentions should not be confused with outcomes.

He said reforms should be regarded as financial and economic infrastructure designed to achieve specific objectives, adding that there could be a significant gap between intention, effort and actual results.

According to him, international investors are less concerned about the stated intentions of policymakers than about the quality of implementation and whether those efforts eventually produce measurable economic outcomes.

Using bank recapitalisation as an example, he said the central function of banks remained the provision of credit to the economy.

He therefore challenged stakeholders to look beyond the amount of capital raised and examine the extent to which the additional capital was translating into increased lending.

“The key question should be what has been the growth rate in credit since capital bases were increased from N50 billion to N500 billion, and in some cases from N25 billion to N200 billion,” he said.

“A bank that does not give credit is an aberration.”

He argued that although such situations were not unusual in Nigeria, they should not become normalised, stressing that the effectiveness of recapitalisation would ultimately be determined by how the additional capital was deployed.

The panelist also expressed concern about the pace of tax reform, saying implementation had been slower than the expectations created by government communications the previous year.

He warned that delays in implementation could undermine momentum, weaken public confidence and ultimately derail the objectives of the reform.

According to him, Nigeria has repeatedly experienced situations in which economic theories and policy frameworks appear sound on paper but fail to produce the anticipated development outcomes because of weaknesses in implementation.

He said while the reforms were still being monitored and could deliver improvements over time, it would be premature to describe the process as a complete success story.

Capital Must Translate Into Productive Investment

Also speaking, an Editor with ThisDay Newspaper, Dr. Obinna Chima, assessed the three reforms from the perspective of confidence and productive assets.

Chima said the critical question surrounding bank recapitalisation should not simply be how much money the banks had raised but where the additional capital was going and what impact it was having on the wider economy.

He specifically questioned whether increased bank capital was translating into greater financing for agriculture and other productive sectors.

He asked stakeholders to compare the proportion of bank financing going to agriculture before recapitalisation with the level after the exercise.

He also questioned whether banks were now in a stronger position to finance large-scale transactions and strategic infrastructure projects, including projects on the scale of the coastal highway.

“If not, then the economy is not where it ought to be,” he said.

Chima noted that the continued scrutiny of Nigeria’s reforms by international financial platforms reflected the importance of demonstrating tangible outcomes rather than merely announcing policy initiatives.

He said global investors and financial institutions would continue to watch whether recapitalisation and other reforms ultimately produced improvements in productive capacity, investment and economic confidence.

On tax reform, Chima raised concerns about the burden that multiple taxes and levies could place on businesses, particularly small enterprises.

He recounted an experience in which officials visited his small business and demanded payments which, in his assessment, could make continuing operations economically unattractive.

He said the experience illustrated the importance of designing tax reforms in a way that expands compliance without undermining the survival and growth of businesses.

He also recalled the case of a friend who received similar demands but chose to ignore them because of a lack of confidence in the system.

For him, the issue was therefore not simply how much revenue the government could collect but whether the tax system could build trust, encourage compliance and support economic activity.

Fintech Gains, But Challenges Persist

Chima also acknowledged the role of fintech companies in expanding access to financial services.

He cited operators such as OPay as examples of companies that had helped deepen access to digital financial services and payments.

However, he said the rapid expansion of digital finance had also exposed weaknesses that required urgent attention, including failed transactions and rising cyber fraud.

He said the reported increase in cyber-related fraud within the banking system demonstrated that the expansion of digital finance must be accompanied by stronger consumer protection, transaction reliability and cybersecurity measures.

The challenge, therefore, is to ensure that increased financial inclusion does not come at the expense of trust in the financial system.

Chima also cautioned against an assumption that every economic challenge could be solved by introducing another reform.

He recalled a recent discussion in which one participant argued that Nigeria needed more reforms, only for a colleague to respond that additional reforms could eventually “strangulate” Nigerians.

The remark, which generated laughter, nevertheless highlighted a serious concern, he said: there must be limits to the number and speed of reforms imposed on households and businesses at any given time.

“People need to breathe to feel the effect of the reforms already done,” he said.

Measuring Recapitalisation Beyond Fundraising

The Managing Editor of Daily Independent, Mr. Kingsley Ighomwenghian, similarly argued that the success of bank recapitalisation should not be measured by the amount of money raised alone.

“Raising money is not success. How do we measure that this recapitalisation is truly a success? Is it just in the act of raising money?” he asked.

He said the more important question was whether the additional capital would result in measurable increases in financing for priority sectors of the economy.

He suggested that banks should be assessed against clear targets, including increased interventions in agriculture, investment in the real sector and financing of critical infrastructure.

For instance, he said stakeholders should be able to determine whether lending to the agricultural sector had increased by a measurable percentage and whether investment in the real sector had similarly improved.

Ighomwenghian noted that banks had outlined their intended deployment of the new capital in their prospectuses, including investments in critical infrastructure and information technology, with timelines ranging from 16 to 24 months.

He therefore urged stakeholders to recognise that recapitalisation was not an immediate process whose full benefits could be expected to materialise overnight.

“On banks, recapitalisation is not an immediate thing. They have raised money. They have put in their prospectus how they want to deploy this percentage to critical infrastructure, IT. So it is not an immediate thing,” he said.

From Macro Reforms to Everyday Impact

The discussions underscored a common theme: Nigeria has made significant changes to its economic architecture, but the durability of those reforms will ultimately be determined by their impact beyond official statistics and policy announcements.

For banking, that means translating stronger capital positions into increased and appropriately priced credit for agriculture, manufacturing, infrastructure, small businesses and other productive activities.

For tax reform, the challenge is to create a system capable of increasing government revenue while maintaining incentives for investment, formalisation and business expansion.

For fintech, the next phase will require sustaining financial inclusion while improving transaction reliability, consumer protection, cybersecurity and confidence in digital payments.

The panelists broadly agreed that the reforms had reset expectations and created new possibilities for the Nigerian economy.

But they also stressed that the next stage must move beyond announcing and implementing reforms to measure their outcomes.

Ultimately, the test of Nigeria’s reform programme will not be the number of policies introduced, the amount of capital raised or the scale of institutional changes announced, but whether those changes produce more credit, greater productive investment, stronger businesses, improved financial confidence and tangible economic opportunities for Nigerians.

The reforms may have altered the direction of the economy. The more difficult task now, the experts suggested, is to ensure that the intended destination is reached.