Despite legal and regulatory reforms aimed at easing compliance for non-profit organisations (NPOs), many legitimate charities in Nigeria still face difficulties accessing financial services.
At the 3rd Africa High Level Civil Society AML/ CFT Conference in Abuja, Victoria Ibezim-Ohaeri, Executive Director of Spaces for Change, highlighted the gaps between reforms and practice. 'The regulatory authorities had done their part and the legislature had done its part, but the private sector was still in the old mode,' she said.
Ibezim-Ohaeri's team created the Multi-Stakeholder Working Group on Charities to bridge the gap between regulators, financial institutions, and civil society organisations. This platform now enables them to share information and build understanding among the parties involved.
Ibinabo Amachree, Head of Lagos Office of the Special Control Unit Against Money Laundering (SCUML), stressed the need for active collaboration between government and the private sector for sustainable reforms. 'Government alone cannot successfully build and sustain reforms without the involvement of all stakeholders, particularly the private sector,' she said.
Nigeria's national risk assessment had changed the country's approach to supervising the non-profit sector, Amachree explained. 'The old narrative can no longer be sustained. We now have FATF-defined NPOs and at-risk NPOs, which means attention and resources should be focused on organisations that are genuinely vulnerable to terrorist financing abuse.' Sa'adatu Salley, Head of Compliance and Internal Control at the National Credit Guarantee Company (NCGC), noted that financial institutions often adopted cautious measures because of the regulatory penalties they faced. 'Financial institutions face huge penalties and sanction risks. Context matters. Institutions should deal with customers on an individual basis because there are ways around over-compliance that are both justifiable and acceptable,' she said.
Dr. Mohammed Gwadabe, President of the Association of Bureau De Change Operators of Nigeria (ABCON), shared similar challenges in the bureau de change sector. 'What we are dealing with is generalisation and criminalisation. Negative perception is a very bad phenomenon because once people see you as high risk, they continue to assume the worst, even when you are doing the right thing,' he said.
The conference attendees, including bankers, regulators, and civil society representatives, explored practical ways to strengthen collaboration and ensure legitimate non-profit organisations maintain access to financial services.
Nigeria's Non-Profit Sector at a Crossroads
The conference highlighted the ongoing struggle of Nigeria's non-profit sector in accessing financial services. Despite recent regulatory reforms, many legitimate charities face difficulties due to heightened risk measures applied by some financial institutions.