The disruptive effects of technology on the financial services landscape, the transformation in financial reporting brought about by the International Financial Reporting Standards 9 (IFRS9), will impact the financial services industry in Nigeria, a report has stated.
The latest edition of PwC Nigeria’s Financial Focus, a journal of Financial Services in Nigeria, also highlighted factors shaping the future of the pensions industry in Nigeria and the tax issues as factors that would define the future and trend of banking going forward.
The third edition of the annual journal released recently in Lagos, featured insights by subject matter specialists across the various fields covered and is a product of the firm’s in depth understanding and knowledge of the industry, gathered from many years of operating in this market and supporting some of the biggest financial institutions in the country.
The journal explored in detail, how FinTech startups and alternative finance solutions are encroaching upon established markets. This, the journal noted is the most creative force – and also the most destructive – in the financial services ecosystem today with huge implications for industry players.
Also of critical importance to banks was the IFRS9 reporting standard , which is effective for annual periods beginning on or after January 2018. The expected challenges of the standard and best practice for its implementation were also discussed in detail.
The current difficult macroeconomic conditions being experienced in the country following the protracted uncertainties around global oil prices was another issue explored in the journal.
The various possible scenarios for the economy and what companies can do to survive was discussed while the use of restructuring to preserve value which is especially essential in these times, was also discussed. In addition, ways financial institutions can improve the operational effectiveness of tax functions in order to ensure their survival as well as other tax issues that can cost the industry a lot of money were also explored in the journal.
The Partner and Financial Services Leader for PwC Nigeria, Patrick Obianwa explained: “This third edition of our Nigeria Financial Services journal gives a good understanding of current trends in the financial services sector in Nigeria while presenting a glimpse of what is to come. Technology is having a disproportionate effect on the financial industry.
“By 2020, consumers will need banking services, but they may not turn to a bank to get them. Or, at least, maybe not in the form we know it today. This is where things are headed and players in Nigeria must begin to prepare and shape their business models accordingly. We have also explored survival strategies in this economy, the future of the pensions industry in Nigeria and how banks can go about implementing the changes IFRS9 brings.
“The future is already taking shape and companies who will succeed are those who make the right changes to realign their business and ride the storm. We hope that the high quality articles in this publication will equip readers with the information they need to stay ahead of the pack especially in these very challenging and uncertain times.
As a firm, we will continue to support the sector with our thought leadership and in-depth analysis of the industry as well as developments in the economy and we hope that by doing this we can evolve a stronger, resilient and more vibrant financial services sector in Nigeria.”