From ashes to a new dawn? A closer look at the key provisions of the Nigerian Bank and other Financial Institutions Act 2020

Folashade Adeyemo

The Nigerian banking system consists of the Central Bank of Nigeria (CBN) which is the apex bank in Nigeria. The institution has a dual role of regulating and supervising Nigerian banks. It discharges these responsibilities through two core banking law instruments, namely Banks and Other Financial Institutions Act (1991) (2020) ¹ and the Central Bank of Nigeria Act 2007. In 2020, the Nigerian legislature signed into law the new Banks and Other Financial Institutions Act (BOFIA). This new Act repealed the previous BOFIA 1991 and the objective of this Act was to develop the Nigerian banking regulatory environment, taking into consideration the changes to global, social, and political realities. To resonate with these changes, the Act provides several important provisions. Amongst these included are provisions for Fintech and, by extension, providing an improvement to the regulation of cyber security; a redesign to the CBN’s regulatory powers within the financial system, which also limits the resolution powers of the NDIC; and the creation of a tribunal for the enforcement and recovery of bank loans.