The Central Bank of Nigeria (CBN) has augmented its foreign reserves by incorporating responsibly sourced gold that meets the London Bullion Market Association (LBMA) Good Delivery standards, raising its total gold holdings to $3.5 billion.
This development coincides with the Senate's recent actions to establish the CBN as the head regulatory body for Nigeria’s rapidly growing fintech landscape while demanding stricter legislative and enforcement measures to combat the increasing prevalence of Ponzi schemes nationwide.
This move to enhance foreign reserves is part of the central bank's wider strategy aimed at diversifying its reserve portfolio for improved financial stability.
A statement released on Wednesday quoted the Governor of CBN, Mr. Olayemi Cardoso, disclosing this update during a workshop focused on ‘Strategies to Maximize the Economic Benefits of Minerals in Nigeria.’
The gold in question, sourced from local vendors, was collected through the Solid Minerals Development Fund (SMDF) in line with the National Gold Purchase Programme (NGPP).
This initiative actively involves local miners while adhering to globally recognized responsible sourcing standards, including the OECD Due Diligence Guidelines and the World Gold Council’s London Principles.
Cardoso further clarified that the CBN procured the gold at rates in Naira aligned with LBMA pricing standards, a strategy aimed at safeguarding Nigeria’s foreign exchange reserves and bolstering the nation’s gold reserves.
By opting for domestically refined gold without the use of foreign currency, he highlighted that this approach bolsters reserve accumulation and supports broader macroeconomic stability.
He also brought attention to significant transformations taking place in global reserve management strategies, which have gained increased relevance against the backdrop of ongoing global economic uncertainties.
The event served as confirmation of Nigeria’s commitment to responsibly and strategically manage its mineral resources, emphasizing the country’s readiness to adapt to a transforming global economy characterized by resilience, diversification, and prudent governance.
The session, convened by the CBN’s Corporate Secretariat and Reserve Management Departments, was aimed at fostering a structured dialogue with key actors in the gold sector, thereby enhancing understanding of current industry conditions, opportunities, and challenges within its value chain.
He pointed out, "Central banks globally are prioritizing economic resilience amid ongoing geopolitical and market uncertainties."
Gold has regained significance as a safeguard against inflation and market volatility, with other essential minerals also increasingly influencing global supply dynamics and advanced industrial benefaction.
Cardoso emphasized that Nigeria's vast natural and human resources can be maximized only through caution, strategic coordination, and long-term planning.
He accentuated the need for strict adherence to globally established standards, underscoring that institutional credibility is reliant on robust governance frameworks.
Hajiya Fatima Umaru Shinkafi, Executive Secretary of SMDF, indicated that the successful delivery of LBMA-standard gold reflects the strength of the organization’s formalization framework and supply chain diligence processes.
Ms. Kurtulus Taskale Diamondopoulos, Director of Central Banks and Public Policy at the World Gold Council, commended both the CBN and SMDF for structuring the Nigerian Gold Purchase Programme (NGPP) in accordance with the twelve London Principles guiding responsible artisanal and small-scale gold sourcing.
She noted that the partnership model between the CBN, acting as the sole buyer, and the SMDF, managing fiscal and supply chain operations, can serve as an effective blueprint for other nations looking to enhance similar initiatives.
Mr. Samaila Zubairu, President and CEO of the Africa Finance Corporation (AFC), reaffirmed AFC’s commitment to funding and formalizing Nigeria’s mineral sector, emphasizing the need for accurate data and mineral processing facilities to attract investments, improve gold recovery, mitigate environmental impacts, and support central bank acquisitions.
Conversely, Ms. Nere Emiko, Executive Vice Chairman of Kian Smith Gold Company, highlighted the necessity for Nigeria to develop strategic gold reserves and exploit commodity exchanges, drawing attention to the country’s currently low reserve levels compared to its peers, and called for increased investment in exploration and transparency.
Emiko also reiterated that the Domestic Gold Purchase Programme is integral to the Central Bank’s broader objectives to enhance reserve quality, reduce dependence on external forces, and establish Nigeria’s mineral wealth as a foundation for prolonged economic stability.
Meanwhile, the Senate has taken steps to designate the CBN as the regulatory authority for the expanding fintech sector, emphasizing the urgency for stricter legislative measures to address the rise of Ponzi schemes.
At a public hearing held at the National Assembly, Senate discussions centered around amending the Banks and Other Financial Institutions Act (BOFIA) 2020 (SB. 959) and analyzing fraudulent investment platforms' operations, particularly scrutinizing the recent Crypto Bullion Exchange (CBEX) incident.
This hearing, organized jointly by Senate Committees focused on Banking, ICT and Cyber Security, Capital Market, and Anti-Corruption and Financial Crimes, highlighted lawmakers’ commitment to reinforcing Nigeria’s financial regulatory framework amidst rapid technological advancements and rising financial fraud.
Senator Mukhail Adetokunbo Abiru, Chairman of the Senate Committee on Banking, introduced the amendment bill, aiming to better the existing provisions of BOFIA 2020 by incorporating technology-enabled financial service providers into a clearer regulatory framework.
He elaborated that while fintech entities such as mobile money operators, digital lending firms, and payment platforms have significantly improved financial access for Nigerians, the current legal and supervisory frameworks have not kept pace with their rapid development and importance in the system.
According to Abiru, the existing model for identifying Systemically Important Financial Institutions mainly focuses on banks, inadequately addressing the realities surrounding larger, data-centric, non-bank financial entities.
This gap in regulation, he cautioned, presents risks to financial stability, consumer safety, data sovereignty, and national security.
The suggested amendment would allow the CBN to classify qualifying fintechs and digital finance firms as Systemically Important Institutions; create a national database for better transparency and beneficial ownership recognition; enhance risk-based supervision tailored to technology-centric services; and ensure systemic stability within the broader financial framework.
Abiru outrightly opposed the idea of setting up an independent fintech regulatory agency, arguing that such an establishment would duplicate existing responsibilities, lead to administrative overlaps, increase costs, and fragment regulatory oversight in an area that requires coordinated governance.
He asserted, “Fintech regulation is intricately linked to monetary policy, payment oversight, prudential supervision, Know-Your-Customer mandates, Anti- Money Laundering measures, and systemic risk monitoring, which are functions that currently reside within the Central Bank.”
Additionally, he emphasized the importance of reinforcing BOFIA and modernizing the CBN's supervisory authority, while advocating for structured collaboration with pertinent agencies, including the Securities and Exchange Commission, Nigerian Communications Commission, National Information Technology Development Agency, Corporate Affairs Commission, Federal Competition and Consumer Protection Commission, Office of the National Security Adviser, and the Federal Ministry of Finance.
Senate President Godswill Akpabio, present at the hearing through Senate Leader Opeyemi Bamidele, expressed that the meeting was in accordance with the Senate’s constitutional duty to maintain the stability, integrity, and resilience of Nigeria's financial system.
He reflected on the financial system's role as the backbone of a modern economy, stating that with proper regulation and oversight, it could mobilize savings, allocate credit, enable transactions, support entrepreneurship, and stimulate economic growth.
Akpabio stressed that integrating technology-enabled financial service providers within an improved regulatory framework aligns with modern financial realities, ensuring innovation operates within well-defined legal limits that guarantee consumer protection, cybersecurity, operational resilience, and transparency.
In addition to fintech oversight, the Senate devoted significant resources to addressing the surge of Ponzi schemes and fraudulent online investment platforms, labeling them a severe threat to public trust and economic stability.
On this occasion, lawmakers referenced the CBEX failure as a stark reminder of the substantial human and economic damage such schemes can inflict. Reports presented during the hearing indicated that young professionals, retirees, traders, small business proprietors, and students suffered from considerable losses instigated by enticing promises of unrealistic returns.
The Senate admonished that beyond individual losses, Ponzi schemes diminish trust in legitimate financial institutions, distort capital allocation, tarnish Nigeria's financial standing, and exacerbate exposure to money laundering and illicit financial transactions.
Akpabio mentioned that the investigative hearing’s goal was to identify regulatory and enforcement shortcomings, assess the coordination among relevant parties, and determine if existing laws adequately tackle digital and cross-border financial malfeasance.
Participants in the hearing included representatives from the CBN, the Nigerian Deposit Insurance Corporation, the Economic and Financial Crimes Commission, the Nigerian Communications Commission, the Federal Competition and Consumer Protection Commission, the Ministry of Finance Incorporated, and the Chartered Institute of Bankers of Nigeria.
All parties endorsed the bill while suggesting specific modifications before its final enactment.
The Senate assured that all submissions and recommendations would be scrupulously reviewed, aiming for evidence-based reforms that enhance trust in Nigeria’s banks, regulatory bodies, and financial markets.
By consolidating fintech regulation under CBN’s authority and tightening restrictions on Ponzi operators, the Senate has signified its commitment to fortifying Nigeria’s financial framework and shielding citizens from exploitation in an increasingly digitized economy.
Comments (0)
You must be logged in to comment.
Be the first to comment on this article!