In September 2007, television screens around the world broadcast images that Britain had not seen since the Victorian era: queues of anxious depositors snaking around a bank branch, demanding their money back . The run on Northern Rock was the United Kingdom’s first bank run in 141 years, and it laid bare the fatal flaws of a regulatory architecture that had looked sensible on paper .
Nearly two decades later and 3,000 miles away, Nigeria stands at a similar crossroads. A bill proposing the Nigerian Fintech Regulatory Commission (NFRC) promises to bring order to the country’s booming but fragmented fintech sector. Yet as the UK’s painful lesson shows, adding layers of oversight without clarity of command can transform a regulatory framework into a liability.
The Tripartite Experiment: A Failure Under Fire
The UK’s Tripartite system, established by then-Chancellor Gordon Brown in 1997, divided financial oversight among three bodies: the Financial Services Authority (FSA) supervised individual banks; the Bank of England was responsible for overall financial stability; and the Treasury handled legislation and crisis management . It was designed to bring specialized expertise to each domain.
When Northern Rock — a mortgage lender with a reckless business model excessively reliant on wholesale funding — ran into trouble in August 2007, the system seized up . The FSA had supervised the bank but lacked the authority to inject liquidity. The Bank of England had the power to act as lender of last resort but was initially reluctant to do so, partly from concern about moral hazard . The Treasury was responsible for the public purse but had no direct supervisory role.
The result was paralysis. As Richard Lambert, then head of the CBI employers’ group, put it, the Tripartite system had been “found wanting under fire” and the handling of the crisis had “tarnished” the UK’s reputation . The separation between banking supervision and the lender of last resort function, coupled with a flawed deposit insurance scheme, turned a funding shortage into a full-blown bank run .
A subsequent Treasury Select Committee report was damning: the authorities had failed to prepare adequately for the support operation, and there was no clear leadership structure or strategy for communicating with the public. When the crisis hit, no one was unequivocally in charge.
Nigeria’s Fintech Puzzle: More Regulators, More Problems?
Fast forward to Lagos in 2026, and the Nigerian fintech sector is experiencing its own version of regulatory complexity — though thankfully, without the queues outside banks yet. With over 430 fintech firms, a projected market value of $230 billion, and mobile money transactions reaching $1.6 billion in 2024, the sector appears to have outgrown its regulatory container .
Currently, a fintech company can find itself answerable to the Central Bank of Nigeria (CBN) for payments, the Securities and Exchange Commission (SEC) for investments, the Nigeria Data Protection Commission (NDPC) for user data, the Federal Competition and Consumer Protection Commission (FCCPC) for consumer complaints, the National Information Technology Development Agency (NITDA) for technology standards, and the Nigerian Communications Commission (NCC) for infrastructure . It is a patchwork that frustrates operators and investors alike.
Enter the Nigerian Fintech Regulatory Commission Bill 2025. Sponsored by Hon. Fuad Kayode Laguda, the bill proposes to establish the NFRC as a dedicated regulator for all fintech activities . At the public hearing held on Monday, some stakeholders, including the Association of Mobile Money and Bank Agents in Nigeria (AMMBAN), welcomed the move as strengthening transparency and consumer protection .
But beneath the surface, the bill creates a governance architecture that echoes the Tripartite system’s most problematic features. It introduces three layers of oversight: the Minister of Finance at the policy level; a new National Fintech Management Council packed with representatives from existing regulators; and the NFRC itself as the operational regulator . Crucially, it does not remove or amend the enabling statutes of any existing agency .
The Accountability Gap: Who Is in Charge When Things Go Wrong?
This is where the Northern Rock parallels become uncomfortable. The UK’s Tripartite system suffered from what a Federal Reserve working paper called a “separation between the roles of banking supervision and Lender of Last Resort” . In Nigeria’s proposed structure, the separation is even more fragmented.
Consider a hypothetical crisis: a major payment fintech experiences a liquidity shortfall. The CBN has statutory authority over financial stability and bank supervision under BOFIA 2020 . The NFRC, under Section 3 of the bill, has licensing and supervisory authority over “all fintech services” . The National Fintech Management Council, chaired by the Finance Minister, exists to coordinate — but does it have decision-making power? The FCCPC and NDIC have consumer protection and deposit insurance jurisdiction. The NDPC has data protection authority.
Who leads? Who communicates with the public? Who decides whether to provide emergency liquidity? The bill does not answer these questions. It merely adds a new institution to an already crowded room.
Hydrogen Payment Services, at the public hearing, warned of precisely this risk. Without “a clear non-derogation clause and defined scope boundaries,” the company cautioned, “there can be dual licensing, conflicting compliance obligations, increased regulatory cost and investor uncertainty” . This is the Tripartite problem Nigerian-style: fragmentation institutionalized rather than resolved.
The Criminalization Question
Another parallel worth noting is the bill’s approach to enforcement. Sections 31 and 64–66 impose heavy fines, imprisonment, and forfeiture for unlicensed activity, and grant broad document production powers without adequate data protection safeguards . Hydrogen Payment Services warned that “over-criminalisation in emerging industries can discourage innovation and foreign investment” .
The UK’s post-Northern Rock reforms moved in the opposite direction. The Treasury Select Committee recommended a special resolution regime for failing banks, allowing for orderly administration while protecting insured depositors . The emphasis was on creating predictable processes, not expanding punitive powers.
What the UK Learned — and Nigeria Might Yet Learn
By 2012, the UK had scrapped the Tripartite system entirely. Then-Chancellor George Osborne transferred the FSA’s supervisory functions to the Bank of England, creating the Prudential Regulation Authority, and established the Financial Policy Committee to monitor systemic risk . The lesson was clear: clarity of command matters more than elegant institutional design.
As the London Evening Standard noted at the time, “two legs is a more efficient mode of transport than three”. In March 2025, the UK Government further announced its intention to consolidate the functions of the Payment Systems Regulator (in charge of regulating innovative products) primarily into the Financial Conduct Authority (in charge of consumer protection). This aims to streamline the regulatory environment and improve coordination and clarity on regulatory responsibilities. Nigeria’s bill, by contrast, proposes adding a third leg while keeping the original two firmly in place.
ALP NG & Co., a legal practice that analyzed the bill, concluded it is “well-intentioned but structurally flawed,” arguing it “represents duplicity rather than simplification” . The firm’s recommended alternatives include a Fintech One-Stop-Shop within existing structures, or strengthening the CBN’s fintech capacity rather than creating a new bureaucracy .
The Bottom Line
The Northern Rock crisis taught the world that financial regulation is not a matter of checking boxes. When confidence evaporates, markets do not wait for inter-agency memoranda of understanding. They need to know who decides, who acts, and who is accountable.
Nigeria’s fintech sector is too important to the economy — and to the millions of Nigerians who depend on digital financial services — to experiment with structures that have already failed elsewhere. The proposed NFRC bill, whatever its intentions, risks creating a Nigerian version of the Tripartite problem: multiple authorities, overlapping mandates, and no one clearly in charge when the next crisis arrives.
As one operator at Monday’s hearing put it, “Regulatory effectiveness depends on clarity and coordination, not multiplication of authorities.” The question for Nigerian lawmakers is whether they will learn from Britain’s painful lesson, or be condemned to repeat it.