A firsthand account from an authority in Regulatory Compliance

In retrospect, there has been a remarkable boom in Nigeria’s Tech industry; startups have soared all over the country as they have drawn an average of $1bn annually since 2015, with several Nigerian unicorns such as Flutterwave, Jumia, Andela, et al have rejuvenated the Nigerian tech industry in a way that has never been seen before; talents and investors are now being drawn to the new gold rush. Nevertheless, there is ample opportunity to drive these margins to where they ought to be.

Now, with such a fast-rising industry — Africa’s tech ecosystem is said to reach a record of one-third of a trillion dollars by 2050, but between January 2020 and December 2021, funding for African tech startups grew 2x faster than global rates, with Lagos, Nigeria in the forefront of this development — regulation would be a big priority to any government, and as with any other large industries, some policies guide the operations of these companies.

In Nigeria, setting up and running a company is a complex business that can be daunting to many; according to Nairametrics, only 40% of the dreamers get to start a company but no more than 1 in every 5 of them survive. Government regulatory bodies like the Corporate Affairs Commission (CAC), The Economic and Financial Crimes Commission (EFCC), and in the case of technology companies, the National Technology Development Agency (NITDA) serve as checks and balances that are much needed in a rapidly growing sector like technology.

With the government taking technology and its regulation into consideration and scrutiny, there is a trend of companies trying to find loopholes or ignoring rules and regulations, risking stringent fines and penalties for a short period of unregulated profits. In 2015–2016, the government metered regulatory fines of over N1 billion to several technology corporations, and with the state of the economy, figures like this could be the end of a company. So, of course, that small margin of profit is never worth the price demanded by regulatory bodies when they are found out.

Delving deeper into some of these issues that are a part of noncompliance with regulations, we find that the common issues are fraud, identity theft, cybercrime, and even the use of companies and corporations to gain access to valuable data to siphon funds. According to reports, African businesses lose $4 billion annually to cybercrime and in 2018 alone, data breaches exposed more than 5 billion sensitive records. This is why financial technology companies and financial services, in general, are starting to take stringent measures to protect the money and sensitive data of users from falling into the wrong hands.

“Data verification is a rapidly growing industry in Nigeria, there is a need to establish viable frameworks founded on compliance, effective communication, and excellent service delivery as an intentional effort toward development”

— Gbenga Odegbami, trustee of the Association of the Data Verification Service Providers (ADVSP)

One of such frameworks is the compliance and security infrastructure company, Identitypass. The initiative provides verification services for companies across over 30 countries in Africa and over 200 active businesses, both within Africa and intercontinental with the overarching goal of properly identifying a billion people.

How IdentityPass is Helping People and Businesses be Compliant

The Nigerian government has mandated the use of the National Identity Number under the National Identity Management Act, 2007, for the “Acquisition, sale or transfer or transmission of shares or equities and other financial instruments” and for the “Registration of companies, sole proprietorships, partnerships and non-profit organizations and other post-incorporation documentation with the Corporate Affairs Commission”. This is why Identitypass, following the guidelines of this Act, strives to enable a secure, easy, and user-friendly way for companies and business owners — “Merchants” — to authenticate the people that seek to legally use their services with multiple data entry points like the National Identity Number (NIN), Driver’s license, Account numbers, etc.

The new product rollout takes it even further by ensuring trust, credibility, and transparency as key drivers to success in African Tech.

It is evident here that unverified information can bring dangerous consequences if such information is not properly secured. Identitypass makes it a priority to verify the uniqueness of over 6000 government-issued identity documents from over 190 countries, thereby helping companies stay within the legal umbrella while providing the best services to their customers.

Identitypass is an easy, sure way to safely get around any regulations regarding the identity or data verification and compliance, it has proven to be the leading verification solution and is employed in a variety of businesses and corporations, including some of the largest fin-tech companies in the country.

On a final note, with the opportunities well defined and the compliance in check, from the gap Identity Pass has bridged, the light is now ‘in the tunnel’ for builders to redefine the Nigerian economy.