Watchdogs, lenders, and other parties take steps to reduce obstacles for charities in the financial system

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By Udeme Akpan

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Nigerian regulators, banks, and civil society groups have intensified efforts aimed at easing stringent banking restrictions on non-profit organisations (NPOs).

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These concerns were expressed at the just-concluded multi-stakeholder working group convened by Spaces for Change, which brought together financial institutions, regulators, and non-profit representatives to address regulatory bottlenecks in Lagos.

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According to the non-profits, their biggest challenge is access to the financial system, particularly difficulties in opening and operating bank accounts due to strict compliance requirements.

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Speaking at the event, Victoria Ibezim-Ohaeri, Executive Director of Spaces for Change, said banks are reluctant to adjust without explicit directives from regulators.

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She said: “Banks say they know the law has changed, but the Central Bank has not directed them to enforce it. We are the ones facing the consequences of that gap.”

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“Previously, many banks categorised NPOs as high-risk entities. That is now beginning to change,” Ibezim-Ohaeri added, noting that training programmes are being conducted for financial institutions across the country.

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Similarly, Pattison Boleigha, Managing Director of Pattison Consulting Limited, said: “One of the major challenges is the inability of NPOs to open and operate bank accounts, in some cases hindering their ability to deliver essential humanitarian services.”

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Boleigha noted that many banks wrongly classify all non-profits as high-risk entities. “Financial institutions should not treat all non-profit organisations as high-risk,” he said.

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Also speaking, Bawo Egbakumeh, Registrar/Chief Executive of the Compliance Institute Nigeria, said improved engagement is bringing clarity.

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“There is now greater clarity on how NGOs operate and how they should be onboarded within the financial system,” he said.

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Confidence Obayuwana of the Nigeria INGO Forum added: “The needs continue to increase, and the government alone cannot meet them. This is where non-profit organisations play a critical role.”

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He further noted that private sector support should be seen as a strategic investment. “When you contribute to reducing poverty, it expands market opportunities for private sector players,” he said.

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The experts examined several issues, including the need for a uniform onboarding process across banks to standardise documentation and reduce compliance burdens, especially for smaller organisations.

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