The Central Bank of Nigeria (CBN) has imposed new requirements on financial service providers, prohibiting the use of unaudited financial statements in their advertising and promotional materials.
Unaudited financial statements are financial reports that have not been verified by an external independent auditor for accuracy and completeness.
Among the stipulations, financial service providers are now obliged to disclose contact details, regulatory authority, and the cost of products, including all associated fees and charges. Furthermore, any mention of competitors in advertisements and making comparisons is strictly prohibited.
The CBN insists that all advertisements must be factual, unambiguous, non-offensive, and free from any potential to mislead or deceive consumers. Additionally, promotional materials should not downplay risks while focusing solely on benefits.
The revised framework also requires that consumers not be compelled to opt into promotional materials in order to access products, and that service providers must establish a process to assess the competence and conduct of their employees regularly.
The CBN highlighted the significant transformation of the financial services industry, marked by evolving market trends and the widespread adoption of technology for delivering a variety of financial products and services through digital channels.
While acknowledging the benefits of these changes such as enhanced consumer choices, convenience, and accessibility, the CBN also pointed out the challenges and risks they pose to consumers.
According to the apex bank, the objective of this revised document is to foster a safe, trustworthy, and consumer-friendly financial services environment by promoting transparency, providing accurate and clear information to consumers, and safeguarding them from unethical and predatory practices that could undermine confidence in the use of financial products and services.
