Stakeholders Want Sound Corporate Governance in Fintech Ecosystem to Attract Investors

By Modupe Gbadeyanka

If the financial technology (fintech) industry intends to attract investors, then the sector must endeavour to put in place sound corporate governance principles.

This was the submission of participants at the second edition of the Ecobank Fintech Breakfast Series held recently at Ecobank Pan African Centre (EPAC) in Lagos.

One of the speakers at the event themed Strengthening the Ecosystem, a Partner at Aluko & Oyebode, Ms Tosin Iyayi, stated that to entrench sound corporate governance, an organization must put in place a well-constituted board of directors who will oversee and perform the roles of strategic planning and keeping oversight of the company’s affairs.

“The board will ensure an organization that is well run in line with laid down ethics, rules and regulations. It should be able to add value to the organisation, review the operations at every given point and offer helpful advice on the growth of such an organization.

“Members should have sound business acumen; they must have experience in running a successful business and be able to steer the direction of the company. There should be gender diversity in constituting the board.

“Members should have good knowledge of environmental, social, and corporate governance (ESG), which refers to a set of standards for a company’s behaviour used by socially conscious investors to screen potential investments,” she said.

Others also agreed with Ms Iyayi, stressing that sound corporate governance strengthens organisations, while good value proposition and structure determine and attract potential investors.

The Managing Director of Mzuri Solutions Limited, Mr Chinedu Onuoha, while speaking on Fintech and Fundraisers: What fintechs need to know about securing investments, advised fintech startups to have a clear insight on the need and purpose for raising funds, stressing that they should ensure such funds are deployed for the purpose.

“Fintech startups should raise funds they actually need. Sometimes you don’t need funds but goodwill. Know when to raise funds and when not to, and where not to raise funds.

“You should have a clear insight on what you need the funds for and meet your payment schedule to avoid a breach of corporate governance and your ethics. Don’t outrun yourself in order not to lose control, thereby questioning your ability to drive the business,” he stated.

Also speaking, the co-founder of Rising Tide Africa, Ms Yemi Keri, who spoke on how to secure funds, stated that investors look at the product, passion and structure of organizations.

“Investors are looking for good deals. You can get investors from networking events such as this breakfast meeting. Visit platforms such as LinkedIn. Check out profiles. There are genuine investors out there looking out for profitable businesses they can invest in,” adding that “on our part, we look at your product, your passion, motivation. We also look at how you will leverage technology for ease of operation and meet the needs of the customers. We look at your team, scalability, value proposition and structure to ensure business continuity.”

Earlier, the Group Head of Consumer Payments at Ecobank, Mr Osahon Akpata, stated that the pan-African bank pays a high premium on the growth of African fintechs, stating that the fintech space is attractive.

He said Ecobank was providing a platform for banks and fintechs to explore areas of mutual interests and opportunities with a view to building a stronger ecosystem.

Other speakers at the event included Lexi Novitske, General Partner, Norrsken22 and Yele Oyekola, co-founder & CEO of Duplo, amongst several others.

The Ecobank Fintech Breakfast Series, which holds in partnership with Tech Cabal, a digital media and publishing firm based in Nigeria, is designed to hold quarterly and aims to gather fintech leaders across the continent to share business insights, as well as discuss pertinent topics in the fintech ecosystem such as regulatory guidelines, funding, and other topics of interest to support both established and fintech startups at different stages of their journey.

Ecobank Nigeria Limited is a subsidiary of the Ecobank Group, the leading pan-African banking group with operations in 33 African countries and an international presence in four locations (London, Paris, Beijing, and Dubai).

Ecobank Nigeria is a full-service bank providing wholesale, retail, investment and transaction banking services and products to governments, financial institutions, multinationals, international organizations, medium, small, and micro businesses, and individuals.

Ecobank is a major player in the distribution of financial services in Nigeria, leveraging digital platforms including Ecobank Mobile App and USSD *326#, Ecobank Online, Ecobank OmniPlus, Ecobank Omnilite, EcobankPay, Ecobank RapidTransfer, ATMs, POSs and an extensive distribution network of over 250 branches and over 50,000 agency banking locations.