The Nation Newspaper

Category: Money

  • CBN, SEC mull framework for Fintech

    By Collins Nweze and Adeola Ogunlade 

    The Central Bank of Nigeria (CBN) on Tuesday said it was working on getting operational framework that will improve the security and operation of financial technology firms.

    CBN Deputy Governor, Financial System Stability, Mrs. Aishah Ahmad, who disclosed this at the Nigerian Fintech Week held in Lagos, said the regulator was planning more infrastructure in the sector adding that Fintech will help boost financial inclusion.

    According to her, Fintech will also boost credit access and promote economic growth.

    She said the financial sector had seen disruptions in the savings space and disruptions in the micro-lending space. Therefore, Fintechs are not organisations that the CBN was not aware of, hence the need to them.

    Read Also: CBN to inject N100bn for cotton textile, garment growth

    He said the CBN was trying to finalise the incubation of some of these companies and also watch what they are doing.

    Also speaking, Acting Director-General, Securities and Exchange Commission, Ms. Mary Uduk said there was need to expand access to finance, find new ways to raise capital, enhance financial inclusion and foster increased participation in the capital market through Fintech.

    She said she was confident that together, the industry would surmount the challenges in the sector and explore opportunities in Fintech.

    “It is our belief that this policy document will broaden the robust conversation and engagements within the ecosystem, encourage responsible use of new technologies and digital finance in the capital market, influence increased international participation & cooperation, and also provide investors with more choices in the Nigerian Capital Market”, she said.

    Uduk said the SEC is looking to adopt regulatory and supervisory practices for orderly development and stability of the system, as it will pay close attention to sustaining confidence and safeguarding the integrity of our market.

     

  • Bridging $5.2tr yearly funding gap for SMEs

    Research has shown that Small and Medium Enterprises (SMEs) are less likely to be able to obtain bank loans than large firms. Their funding is generated internally from friends and family members. The International Finance Corporation (IFC) estimates that 65 million firms, or 40 per cent of micro, small and medium enterprises (MSMEs) in developing countries, including Nigeria, have unmet financing need of $5.2 trillion yearly. However, manyNigerian banks are showing new commitment to supporting government’s growth and development agenda through SMEs funding, writes COLLINS NWEZE.

    Banks need to be at the heart of the Small and Medium Enterprises (SMEs) – providing support, capital and innovative solutions to help them prosper.

    This is because SMEs play a major role in most economies, particularly in developing countries. They account for the majority of businesses worldwide, and are important contributors to job creation and global economic development. They represent about 90 per cent of businesses and more than 50 per cent of employment worldwide.

    Formal SMEs contribute up to 40 per cent of national income (GDP) in emerging economies. The numbers are significantly higher when informal SMEs are included.  According to World Bank estimates, 600 million jobs will be needed by 2030 to absorb the growing global workforce, which makes SME development a high priority for many governments around the world.

    In emerging markets, most formal jobs are generated by SMEs, which create seven out of 10 jobs. However, access to finance is a key constraint to SME growth, it is the second most cited obstacle facing SMEs to grow their businesses in emerging markets and developing countries.

    That explains while FirstBank of Nigeria (FBN) Limited has continued to identify with SMEs as the engine of the economy, whilst promoting its growth and contribution to the national economy. For instance, the bank has provided financial support/dedication to the SMEs lending N170.3 billion to SMEs from 2017 to date. Also, the number of SMEs supported by the bank over the last three to seven years are 70,703 SMEs among other milestones.

    As part of the launch of its specialised SME propositions, the bank convened its 2019 SME Week during which customers and non-customers of the bank participated in a wide range of events and activities designed with the SME in mind.

    The activities range from the SME Masterclass themed “Designing and Implementing a Growth Strategy for your Business” to specialised one on one sessions with renowned business coaches and the launch of seven unique pillars which make up our SME propositions available via SMEConnect – The FirstBank SME portal.

    The highlight of the week was the launch of the SME portal, a platform through which SMEs can access the bank’s unique propositions that have been designed to equip them with the essential tools needed for the growth of their business.

    The SME portal is also designed to help SMEs identify various gaps that hinder their business growth leveraging our innovative Business Diagnostics Tool, with a view to proffering tailored solutions and creating opportunities for business improvement, profitability and sustainability.

    Following extensive research by the bank over the years, it identified these seven strategic pillars to be essential for the sustainability and growth of the SMEs. These include – access to infrastructure, access to talent, capacity building, policy and regulation, access to resources, access to market as well as access to finance. This has duly informed our strategy and propositions for our SMEs going forward.

    The bank said its sole aim for the programme was to ensure it met customers’ business needs. This means having a better understanding of what their business requirements are and providing more tailored and relevant solutions for them.

    It said the programme gave its customers and SMEs the opportunity to participate in a one-on-one coaching sessions with renowned SME experts.

    It was also opportunity for participants to take advantage of the personalized coaching sessions for selected SMEs at designated branches.

    “At the closed sessions, SME Experts reviewed business diagnostics results with SMEs and discuss improvement opportunities based on focused areas, while at the open sessions, SME owners were able to walk into selected branches, take the Business Diagnosis Test and have their results reviewed by a resident coach”.

    Other activities include one on one coaching advisory sessions, to be simultaneously held across six locations in Lagos, Abuja, Rivers, Oyo, Kano and Owerri. The weeklong event  rounded off with a live webinar facilitated by Gbenga Shobo, the bank’s Deputy Managing Director.

    Shobo said: “FirstBank has over the years, been at the forefront of supporting Businesses, especially the SMEs as we recognise that the SMEs are the engine of the economy. We are committed to ensuring that we leave no stone unturned as we connect with them in their continued contribution to national development in terms of the employment opportunities they create as well as their contribution to the nation’s GDP amongst many economic values.”

    “The FirstBank SME Week is driven to promote the Bank’s SME proposition, thereby having SMEs across the country optimally enlightened on how to plug in. We believe this will help SMEs bolster their contribution to the growth and development of the economy” he concluded.

    Likewise, Fidelity Bank Plc, Nigeria Export Promotion Council (NEPC) and Lagos Business School (LBS) have united to unlock export potential of 100 Micro Small and Medium Enterprises (MSMEs) in the North.

    The institutions are supporting the bank in training over 100 Small and Medium Enterprises (SMEs) at the Export Management Programme (EMP) held in Kano.

    Guaranty Trust Bank (GTBank) Plc also partnered the Development Bank of Nigeria (DBN) to disburse N25 billion funding to entrepreneurs in Nigeria’s Micro, Small and Medium Enterprises (MSMEs) sector. The funding is the single largest disbursement by the DBN to any financial Institution in Nigeria since it commenced operations.

     

    Other milestones

    Findings showed that over the last three to seven years, FirstBank  has supported over 70, 703 SMEs, while it continues to partner with government and big financial technology (Fintechs) companies to bring banking services closer to the people.

    FirstBank has been providing technology-enabled services and richer user experiences to petty traders.

    In turn, those firms can devote more time and energy to running their businesses. The SMEs as defined by the Central Bank of Nigeria (CBN) are economically independent companies with about 11 to 300 employees and an annual debit turnover of between N5 million to N500 million.

    “First Bank has over the years, been at the forefront of supporting Businesses, especially the SMEs as we recognise that the SMEs are the engine of the economy,” said Gbenga Shobo, deputy managing director, First Bank of Nigeria Limited.

    “We are committed to ensuring that we leave no stone unturned as we connect with them in their continued contribution to national development in terms of the employment opportunities they create as well as their contribution to the nation’s GDP among many economic values.”

    Following extensive research by the First Bank over the years, it identified these seven strategic pillars to be essential for sustainability and growth. These include, access to infrastructure, access to talent, capacity building, policy and regulation, access to resources, access to market as well as access to finance.

    Lack of stable power supply from the national grid has been a major stumbling block to small businesses and artisans, who make up the informal sectors and a lot of them have closed shop because they can’t continue to spend money on fuel to run generators.

    Stakeholders say the opaqueness of the venture makes it difficult for banks to extend loans to them. Also, the large chunks of operators in the informal sector do not keep proper books of account, making it difficult to ascertain their cash flows.

    Despite these monumental challenges, the industry is paramount to the country, as it is the largest employer, but experts have agreed that a lot needs to be done by government and the private sector in reviving it.

    According to the Ministry of Industry, Trade and Investment, over 37.07 million, small and medium-scale enterprises, MSMEs, account for more than 84 per cent jobs in the country.

    The ministry further stated that about 48.5 per cent of the gross domestic product (GDP), as well as about 7.27 per cent of goods and services exported.

    Of the total number, micro-enterprises account for the bulk of the MSMEs in Nigeria, with 36,994,578 enterprises, about 99.8 per cent, while small enterprises took 68,168, and medium enterprises 4,670.

    FirstBank and Microsoft had, within the year,  partnered to provide supporting technology solutions at a discounted rate to over 40 million SMEs. The  aim was to encourage them to embrace technology in their operations.

    Nigeria said the target was to reach about 40 million SMEs and interested individuals.

    “The SMEs can buy some of the Microsoft solutions at discounted rates, pay in naira as against the dollar, thereby removing the stress of exchange rate which is sometimes a challenge for the SMEs. They now have a portal where they can ask for advice on the products and some extra sales support we can also get Microsoft to give them,” he said.

    “The SMEs segment is so important to the livelihood of many Nigerians, and we have seen that SMEs have the ability to grow. One million new devices will be coming online in 2020 while 60 per cent of computing will be in public cloud in 2025, adding that 25 per cent of workers’ time is wasted by information overload,” according to Microsoft.

  • New campaign for Hollandia Evap Milk

    By Collins Nweze

     

    Hollandia Evap Milk has launched a new marketing communication campaign. Aimed at inspiring and enabling consumers to achieve their daily goals, the campaign strengthens the milk brand’s position as the all-rounder evaporated milk and positions it as the perfect accompaniment to a wide variety of breakfast meals, foods and drinks, such as cereals, custard, pancakes, smoothies, tea, coffee, and chocolate beverages.

    Tagged “Start Your Day Right with Hollandia Evap”, the TVC follows the life of celebrity mum and goal-oriented actress, Mercy Johnson-Okojie, and other mums.

    The film showcases their daily morning routine of preparing nourishing breakfast meals with Hollandia Evap Milk for their families, and highlights the satisfaction they derive from choosing the Hollandia Evap Milk brand to achieve their goal of keeping their families healthy, well-nourished and prepared for the long day ahead. The commercial closes with Mercy Johnson-Okojie endorsing Hollandia Evap Milk as the ideal evaporated milk brand that helps consumers start their day right.

    Read Also: Hollandia Evap Milk unveils new pack

    The campaign which will be executed on TV, Radio, Print, Outdoor and Digital media platforms celebrates women, wives, mothers, fathers, and other care givers, for their role of taking care of and providing for their families, and acknowledges their aspirations to achieve success on multiple fronts.

    Speaking on the launch of the new campaign, Managing Director of Chi Limited, Deepanjan Roy, said “the new Hollandia Evap Milk communication embodies the company’s goal of inspiring consumers to make the right decisions daily to live healthy and happy lives. We want our messaging to resonate with consumers who are desirous of using a wholesome, nutritious, and tasty milk to complement their breakfast or other meals. We are confident that the new commercial would enable consumers to aspire for success by starting their day right with Hollandia Evap Milk.”

  • Access Bank completes post-merger integration

    By Collins Nweze

     

    Access Bank Plc on Monday announced the completion of the second phase of its its integration, where it has brought together all its core banking platforms.

    In a statement, the bank said that the completion of this phase heralds the delivery of one of the most robust banking platforms in the world that will serve its  growing base of over 30 million customers seamlessly and enhance its service delivery and uptime targets.

    “One of the benefits of the integration is the simplicity of initiating and receiving bank transfers, as customers will no longer need to select between ‘Access’ or ‘Access (Diamond)’ when transacting. Customers simply need to select ‘Access Bank’ for all transactions,” it said.

    Read Also: Access Bank, Star plan N150m reward

    Its  Group Managing Director, Herbert Wigwe, lauded the various committees for their effort during the period of the integration, saying, “A Special thank you to the integration committee for ensuring all the milestones expected at the various stages of integration were achieved within the scheduled timeframe.”

    Appreciating customers for their unwavering trust and support throughout the integration phase, the Executive Director, Retail Banking, Access Bank Plc, Victor Etuokwu, added that the Bank is now better positioned than ever to serve its customers with the best solutions and service the industry has to offer. “Delivering the best services possible to our customers remains our highest priority.  We can now offer the best digitally-driven financial solutions that will make our customers’ transactions simpler, faster and convenient”.

  • ‘How we’re tackling fuel fraud’

    By Collins Nweze

     

    The Managing Director, Concept Nova, Chukwuma Ochonogor has said that the firm’s fuel management system has eliminated  fuel theft suffered by many businesses, especially fleet operators .

    He spoke during a Product Knowledge Session held in Lagos.

    The solution named Fuel Control System (FCS) is cloud-based software designed to monitor fuel in the tank and the asset’s location. It assists business owners to optimize their diesel consumption and offer abundant return on investment.

    It comes in two variants – a stationary FCS for tanks and a mobile FCS for trucks.

    Ochonogor stated that “the Fuel Control System enables corporate heads, business/asset owners and operation managers in different industries such as transportation, haulage and Logistics, shipping and delivery Services, among others have ultimate control over their diesel usage.

    The solution, according to Ochonogor “is a unique and flexible fuel management solution designed to get real-time information on diesel consumption and fueling activities. It also allows you to get various alerts of any unusual and suspicious activities such as diesel tampering, theft or tampered refueling process that occurs within your organisation”.

    He mentioned that according to the World Bank, 70 per cent of firms in Nigeria use generators. This has made diesel the second or third highest expense for organizations. Being one of the highest operational expenses does not deter employees and vendors from stealing diesel. Their acts increase organizations’ budget which eats into their Return on Investment .

    However, with Stationary FCS, organisations can get prompt alerts that would eliminate theft and reduce fueling cost greatly, he said.

    He further explained that the Mobile FCS has a vehicle tracking feature alongside the many benefits integrated to the solution. The vehicle tracking feature gives precise information about the location and time of criminal activity to the authorized individual assigned in your organization.

    This would aid in taking disciplinary actions and facilitate effective decision making.

  • NNPC deepens downstream oil sector reforms

    By Collins Nweze

    The Nigerian National Petroleum Corporation (NNPC) has reiterated its commitment to entrench downstream competitiveness using innovation and information technology

    The Chief Operating Officer Downstream, Adeyemi Adetunji made this assertion while declaring open the 13th Oil Trading and Logistics Expo taking place in Lagos.

    Adetunji who was represented by the Managing Director Petroleum Products Marketing Company (PPMC), Bala Wunti stated that emerging market trends towards a digitised and automated world necessitate a rapid shift in focus for all downstream players.

    Read Also: NNPC committed to drive positive change using internal talents – Kyari

    Adetunji said: “Old approaches of driving Cost efficiency and Safety are pretty much exhausted, hence in line with the Corporation’s TAPE Agenda, NNPC is aggressively working on digitizing its downstream operations”.

    He further stated that the emerging value models revolve around the confluence of a hydrocarbon economy and a data economy hence all hands must be put on deck to fully digitalise the downstream sector.

  • Bank CEOs laud NCC over USSD charges suspension

    The Body of Bank CEOs applauds the recent notice from the National Communications Commission (NCC) announcing the immediate suspension of end-user billing for Unstructured Supplementary Service Data (USSD) services. We would like to thank the Federal Government of Nigeria for championing this action.

    When presented with two options by the telecommunications companies – corporate billing versus end-user billing – banks supported the standard practice for a relationship between a telecommunications company and their subscribers. We proposed the same method they charge for voice calls, SMS and data. We then asked to work with the telecommunications companies to bring the cost of their USSD service down for Nigerians.

    We were therefore very surprised at the announcements from MTN on the 19th and 20th October.

    Read Also: Interswitch completes N23b bond placement

    Since banks cannot reasonably be expected to charge for the service of another industry, over which they have no control of price, quality and security we are delighted that consumers will now be able to access their bank for free, using USSD. This is a giant leap for the National Financial Inclusion Strategy where, through Bank’s subsidising USSD, we have already been able to bring 20m Nigerians into the formal financial system in recent years.

    The banks, supported by the Central Bank of Nigeria, have long advocated the designation of USSD services as a critical national asset to enable such free access to USSD. Indeed, in countries like India, free access to USSD channels have long been established to successfully drive financial inclusion.

    We look forward to working with the telecommunications industry to achieve the objectives of the National Financial Inclusion Strategy. We believe that with this new development, we will achieve 80% financial inclusion in 2020.

  • Interswitch completes N23b bond placement

    By Collins Nweze

     

    Interswitch has completed N23 billion Series 1 Fixed Rate Senior Unsecured Callable Bonds issue. This followed the registration of a N30 billion debt issuance programme with the Securities and Exchange Commission of Nigeria (SEC),. The bond was issued via a Special Purpose Vehicle , Interswitch Africa One Plc.

    The Series 1 Issue priced at 15 per cent was 2.6 times  subscribed. The seven-year bonds, embedding a call option that can only be exercised from the second year, are payable in full at maturity. An application will be made to list the Bonds on The Nigerian Stock Exchange on receipt of the SEC’s approval of the proposed allotments.

    Investor participation was restricted to qualified institutional investors as defined by the SEC in Nigeria, with a proposed Bonds allocation of 64 per cent to pension fund managers, seven per cent to asset managers and 22 per cent to commercial banks pending SEC approval. The strong level of over subscription demonstrated investor confidence in the Interswitch brand, business model and long-term strategy, supported by strong domestic ratings from both Agusto & Co. Limited and Moody’s Investor Service.

    The Founder and CEO, Mitchell Elegbe, commented: “We are delighted to report the success of the first series of Bonds issued under our Programme, especially with the level of interest shown by investors. Diversifying our funding sources through the inclusion of these Bonds will enable us achieve our strategic objectives and vision.”

    FBNQuest Merchant Bank and Stanbic IBTC Capital acted as Lead Financial Advisors/Issuing Houses and ABSA Capital Markets Nigeria, FCMB Capital Markets, Quantum Zenith Capital & Investments and Rand Merchant Bank Nigeria, as Joint Issuing Houses.

  • Cadivus Hunters announces N120m house lottery 

    By Collins Nweze

    The 2KLandlord.com, a subsidiary of Cadivus Hunters and a prime property lottery  platform, has unveiled the ‘2K Landlord’ raffle with a grand prize of a fully furnished luxury home in Lekki Phase 1 in Lagos valued at N120 million.

    The company explained that with the lottery, every Nigerian now has a chance of owning multi-million naira homes or the cash equivalent if sold.

    The platform, which is owned by Cadivus Hunters, aims to drive interest in property ownership amongst Nigerians, while creating multi-millionaires on a scale that empowers beneficiaries and impacts many more lives.

    Speaking during a press conference, the President of Cadivus Hunters, Opeyemi Odeyale, said  that the 2K Landlord platform mirrors the principles of crowdfunding to create multi-millionaires one at a time and to provide Nigerians with dream homes through a sustainable and credible raffle system .

    “Most Nigerians, even those that are fully employed, understand the difficulty of owning a home, especially in a moribund mortgage market as Nigeria’s,” he said.

    For the initial launch, Cadivus Hunters is offering a fully furnished five-bedroom semi-detached house located in Lekki Phase One, valued at N120 million.

    Read Also: Cadivus Hunters announces N120m house lottery 

    A participant can enter the draw by purchasing a ticket worth N2,000 via its website or partner platforms. At the end of 90 days, a final draw will be carried out to select a winning ticket that will claim the N120 million luxury home. Also, cash awards of N100,000 weekly and N500,000 monthly will be given throughout the duration of the lottery.

    Multiple entries are permitted for those who want to increase their chances of winning the grand prize of a N120 million fully furnished luxury home.

    The property has proven popular with producers in the entertainment industry having featured in award-winning videos such as King of Boys, Rumour Has It and Tender by Slkay.  The winner can choose to live in the house, rent it out or sell it. Whatever the choice, a multi-millionaire emerges. The promotion is endorsed by the Lagos State Lotteries Board.

  • CBN stops firms, individuals from bonds purchase

    By Collins Nweze

    The Central Bank of Nigeria (CBN) has barred individuals and local non-financial firms from buying high-yielding central bank bonds as it tries to boost the economy by steering lending more widely.

    The two types of investors are excluded from participating in auctions for open-market operations, which are short-term central bank securities.

    “We don’t want to leave room for arbitrage,” central bank spokesman Isaac Okorafor told Bloomberg. It will discourage banks from giving loans to “speculators” who want to buy government securities instead of investing in the “real economy.”

    The measures are in line with a wider policy to penalize banks that don’t boost lending, according to Okorafor. The ban’s impact may be limited because it does not extend to the secondary market or foreign portfolio investors.

    Read Also: Cadivus Hunters announces N120m house lottery 

    “The central bank has been uncomfortable with the level of demand at the OMO auctions recently and clearly they’re trying to reduce it,” said Omotola Abimbola, an analyst with Lagos-based Chapel Hill Denham Securities Ltd.

    “But this measure won’t go that far because they still have access to the secondary market.”

    OMOs, which typically have maturities of less than a year, were originally used by the central bank to control liquidity and mainly bought by local lenders. But they have been opened up to others in the past two years and have become the main instrument for foreign carry traders.