The Central Bank of Nigeria says it is developing a Consumer Protection Framework (CPF) for banks and other financial institutions to boost financial inclusion.
U. A. Dutse, Director, Consumer Protection Department at CBN says the planned CPF is also expected to build public confidence in the Nigerian financial system by guaranteeing high standards for efficient customer service delivery, market discipline and ensure that consumers are treated fairly by financial institutions regulated by the apex bank.
“It shall form the bedrock for establishment of a virile consumer protection regime in the industry, thereby enhancing financial inclusion and ultimately a stable financial system,” CBN says.
The CPF defines the direction of CBN on consumer protection and would lead to the development of various regulatory/supervisory instruments that would aid the achievement of the overall objective, the document says.
With the new framework, the CBN plans to collaborate with key stakeholders to facilitate the protection of consumer rights; stakeholders such as the Consumer Protection Council, Bankers’ Committee, and some other relevant Government agencies.
CBN says appropriate measures shall be established by financial institutions to guarantee protection of consumer assets and privacy, covering primary areas such as fraud and data privacy.
A section of the document regarding protection of consumers against fraud says that “financial institutions shall establish policies and controls to safeguard consumer assets against fraud. These policies and protocols may include the use of sophisticated software and transaction monitoring systems to monitor the internal processes/operations of financial institutions.”
Regarding the safety of electronic payment, the CBN document requires that “electronic payment instruments/systems shall be embedded with safety mechanisms; institutions shall ensure regular systems updates to guard against possible security lapses. The CBN shall specify minimum technology standards for payments platforms.”
It further emphasized that financial institutions shall enforce disciplinary action against employees involved in fraud and report same to the regulator. “Where required, the CBN shall blacklist such employee from further employment within the industry.”
According to CBN, appropriate data protection measures and staff training programmes shall be put in place to prevent unauthorised access, alteration, disclosure, accidental loss or destruction of customer data. According to it, “the consent of consumers shall be obtained in writing before their data is shared with third parties. For this purpose, a third party includes a subsidiary or an associated company.”
CBN says the CPF followed due consultations and engagement with industry, other regulators and stakeholders including consumer advocacy groups, civil society and the general public.
*Text courtesy Technology Times. Photo shows CBN Governor, Godwin Emefiele.