• Super Admin
• 07 Mar, 2026

The finance company segment of the financial services industry is expected to play a more prominent role in Nigeria's credit ecosystem over the next five years, particularly as gaps persist between commercial bank lending and microfinance coverage. In this interview with OLUWAKEMI ABIMBOLA, the Chief Executive Officer of Crystal Finance, Imoudu Mamudu, outlines how technology adoption, retail funding expansion and stronger regulatory oversight are likely to shape the sector's trajectory Crystal Finance has marked its 10-year anniversary. Comparing your original business plan with the company's current position, what has changed the most? If I think back to the strategic plan we had at the beginning, let me mention three different areas. What I would say defines what makes us tick, our selling points, our unique selling points, is that we have an ambition to be able to deliver our services with speed and convenience. Indeed, delivering our services with speed and convenience is what sets us apart from our competitors. So, if you cannot give it to people with speed, then you are doing nothing at all. So again, speed and convenience were unique selling points for us, and that strategy has not changed. It remains the same. When I look at our target markets and maybe target audience and our client focus, as we were setting out, we said we should perhaps target SMEs and HNIs in the middle. I would say that that has likely changed, maybe for different reasons. When we started ten years ago, perhaps the people you categorise as HNIs, normally, if you use an amount, if you say maybe from N1m and above, you categorise them as HNIs. Today, if we keep to that structure, it means we have to continue to go up, and then you leave people who you were serving before, people who have always been with you. And one thing about our clients that we noticed is that they have always been sticky with us. So, for people who are there, some of them move on, and then of course, others defer. And then technology has also made things easy. The reason why we envisioned that we should focus on this set of people is different. Maybe first of all, we are sure that when they go into difficulties, they probably can come out quickly. So we are sure that in a way, even if you have a bad loan, it just takes time, and you work it out. But again, valuation and everything have made that amount change, so we can say we have cascaded that to now also include retail. So that strategy on clientele focus has, in a way, been adjusted to also include retail. And then when I also look at maybe our strategy for delivery methodology, our touchpoints, where people come to get our service, setting out, it was just the physical office. So, anybody who needs to do anything reaches out to us here, or we either go to them. But now technology has made it such that people rarely come to the office anymore. So that delivery methodology and the touchpoints have also changed. Now, everything is done digitally, and we are de-emphasising physical presence. You do not need to be here physically. Again, of course, the coverage area, if you mean physically, ,then it means it is a small area that you cover. Then again, when we say convenience, part of our selling point is convenience and simplicity. So, if it is going to inconvenience people to come and buy your product, then you are not living true to your unique selling point. Interesting. But largely, the changes you've experienced have been beyond your control. Of course, you have to change. Well, yeah, you keep reviewing your strategy, and as you see things change, you cannot stick to the same strategy. And you also look at the result of whatever strategy you put out there. You look at the results, and then you keep modifying them. But again, we have been forced to change because of the external environment, definitely. Over the years you've been in business, what moments have most defined your leadership journey? One of such, I probably would say, would be perhaps the COVID era. During the COVID era, we were probably just about four years old, still trying to build momentum and trust. And then, of course, COVID came, and it caused a lot of panic. People did not understand a lot of things. The first thing was that our clients, on both sides, perhaps the clients that you give money to, the credit clients, had that fear that the portfolio quality would be very bad. And also, there was the fear that the people who give you money, while you are trying to still build trust, might move to safety. So, you would expect that you are going to have issues with the portfolio, and you are also going to have issues with liquidity. Then, of course, the first two weeks of shutdown came with so much uncertainty. Prior to then, our infrastructure, banking, core banking application, and other IT were on-premises. When they had to shut down, the panic increased because everybody wanted to fly to safety. Even while you are shut down, people might say, 'Look, I need my money.' So, within the first week, we liaised with our IT consultants and migrated all our infrastructure to the cloud. Automatically, it enabled us to work remotely. From home, we could deal with clients' accounts, send reports, and so on. It lifted the spirits and accelerated our technological adoption. Initially, we feared a flight to safety, but what we noticed was increased funding. That trust was further strengthened because clients received interest payments seamlessly without delay. So that further cemented the business and the name. And I would say it was a defining moment. The financial services industry has experienced major shifts in interest rates, regulation, and digital disruption. How have these dynamics influenced your strategy? Maybe I will take a trajectory. Perhaps speaking when things were easy or rosy, that is, when you had lower rates, money market rates, MPR, that is, before 2023. But since 2023, MPR has been going up, of course, in reaction to inflation, trying to cope with inflation. For us, that impacts us on two fronts. On so many fronts, I want to speak about MPR going up and money market rates going up. That immediately impacts our funding capacity, how we get loanable funds and the funds that we give out, and it impacts our cost of funds. From 2023, when things started going up, or perhaps prior to then, our funding strategy, how we get funding for the business, was focused on HNIs. We would get long-term funding from HNIs or institutional investors, which would offer stability. But once rates keep going up, nobody gives you a discount; they give you something higher. So, at any given time, instead of locking in long-term, we now resort to short-term deposits, maybe 186 days, 90 days, or one year. We believe that within this horizon, when rates start coming down, we can immediately reprice. Again, it is riskier because you do not have stable funds, but we believe we have built enough trust that clients are likely to continue with us. That is how we try to manage our funding. Again, I would say that as a company, we are built to be nimble and efficient. We run a lean organisation. Anything about costs, we focus on. One of the highest costs we have is our cost of funds, so we have to manage that carefully. Interest rates impact that, of course, and inflation has the same effect, it traps interest rates. Then there were FX issues. Many of our HNIs are savvy investors needing to rebalance portfolios, so when FX rates rise, they liquidate Naira positions to buy FX. That causes outflow, and we have to adjust funding sources towards retail. This helps manage costs and provides some predictability and stability. To begin with, what risks does your business face, and how are you managing them in the current economic climate? We have traditional risks: credit risk, liquidity risk, and operational risk. These are traditional to the business. From day one, we focused on risk management and governance structures more than scaling. We ingrained risk management into processes and operations and were comfortable managing these traditional risks. But there are new and emerging risks: cybersecurity, data protection, third-party and vendor risks. We need to understand them and learn to manage them. Over time, we have taken a dynamic approach, particularly for new risks. We do penetration testing periodically to check our resilience to cyberattacks and vulnerabilities. If we see weaknesses, we correct them. Every quarter, we conduct penetration tests for the IT infrastructure, discover weaknesses, and correct them. We also do scenario analysis and stress tests for economic shocks. For instance, COVID made us model stress tests to assess our position in similar calamities. While building capacity and knowledge is not easy, we prioritise training and equipping our people. For areas without in-house capacity, we start with consultants but build internal capacity quickly. Our approach is forward-looking: we anticipate risks and reduce vulnerabilities proactively. Which metrics most effectively capture the company's progress over the past decade? Success can be measured by many criteria. I would not want to brandish figures; no matter what you say, others have better numbers. But what gives us comfort is our client retention rate, over 95 per cent. Everyone who comes to us sticks with us. For me, that is a measure of client satisfaction. They are happy with our services, and that is why they stay. It also shows that we can future-proof our revenue. Repeat business from clients allows us to project steady growth. So, client retention rates give us comfort and indicate that we might be doing something right. Let's consider the broader finance company sub-sector within the financial services industry. What key challenges do you believe operators in this space face, and what is the five-year outlook for the segment? I would say that one of the, perhaps speaking from our perspective, and it might not be different from anyone else's perspective, the challenges we have in the sector revolve around human resources. When you are doing business and want to scale quickly, you need people to help manage that risk. Scaling itself is a risk because if a business grows big overnight, that can lead to a bigger headache. You need trained people to support growth. When we were starting, we spent a lot of time and resources training our people. We retained some of them, but you cannot retain everyone. As you build, you hope to have people you can develop further, but many leave for bigger offers. As you said, regulators are introducing stiffer regulations. Compliance now has zero tolerance for non-compliance. You need skilled people to uphold standards. The same challenge exists in every other sector, even banks. When you bring staff up to a certain level and coach them, many move on after gaining skills. People are essential, but retention remains a challenge. So, factoring in financial inclusion, what is the outlook for that sub-segment over the next five years? I would say the sub-sector is still young and will not achieve its full potential. Finance companies are supposed to bridge commercial banks and microfinance banks. Microfinance banks serve the lower end, commercial banks serve the high end, and the middle segment is underserved. There is a prospect here. As the economy changes, people shift between segments. The "middle class" or "upper-lower" strata form a large spectrum. Many financial institutions, particularly microfinance institutions, shy away from funding SMEs, even though that is where real growth occurs. Doing so creates a funnel effect and keeps funds circulating. Regulation is improving the industry and enforcing standards. Technology adoption also helps, so there is a lot of potential. So, considering the current macroeconomic outlook, what should investors be focusing on right now? I will start with our sector. Investment here mirrors money markets and returns. The trajectory for the year suggests macroeconomic indices will improve: inflation is expected to fall, MPR may come down, and money market instruments may temper. This is not good news for investors seeking high yields. It means yields will likely fall. But a better economy is what we all hope for. For investment, while rates are still high, investors can lock in long-term to secure higher yields for their portfolios. Another alternative is the capital markets, where returns have been attractive for those monitoring them closely. However, fundamentals may not fully support the pace of growth. Risk appetite matters. For those seeking steady returns and capital preservation, the capital markets allow them to lock in investments and ride them until adjustments are needed. Long-term investors can tolerate fluctuations. Retirees or elderly people needing a predictable income may avoid locking in now due to potential volatility. The general trend is expected to improve, allowing early and strategic positioning. Looking forward, what will be your business's main priorities over the next five years? Looking at how far we have come and the trends observed, our priorities focus on three areas: We are exploring blockchain technology and peer-to-peer lending. Over time, these platforms could allow fund providers to receive higher returns and borrowers to access cheaper funds by eliminating the middleman. Trust is key, but a secure platform can facilitate direct interactions and fee monetisation. Everything revolves around client convenience. Our original clients are ageing, and the next generation, Gen Z and Generation Alpha, is entirely digital. We need seamless, on-the-go infrastructure to cater to them, ensuring convenience and continuity of business. Cybersecurity and AI-induced cyberattacks are rising threats. All infrastructure must adopt zero-trust models and constant vigilance to prevent privilege misuse. Capacity-building in defence is critical to ensure uninterrupted service delivery alongside product development. Source: https://punchng.com/?p=2083663