Category: Money

Point of Sale (PoS) machines deployment has increased in recent months to serve new entrants into the digital banking space. Many cardholders, especially at the grassroots, previously cautious about digital banking and safety of their funds, have embraced the scheme as COVID-19 pandemic reduced cash demand and usage but there are challenges, writes Assistant Business Editor COLLINS NWEZE.

Digital banking is the new route that financial service providers and regulators are travelling to offer seamless services to the banked, and encourages the unbanked and underbanked to join the financial services net.

Two channels have for long dominated the digital banking space – mobile banking and Point of Sale (PoS) services.

In the mobile banking space, the e-Bills Pay was a major contributor to the N3.05 trillion achieved in the last one year. Its is an account-based, online real-time product that facilitates the payment of bills from an account. It ensures instant credit of payments and receipt of collections on behalf of billers/merchant recruited on the platform.

The platform is used for payments such as utility bills, cable TV subscriptions, hotel and airline bookings, school fees, and airtime top-up.

According to Nigeria Interbank Settlement System (NIBSS) data, more Nigerians are embracing payment of bills electronically as opposed to paying with cash.

Meanwhile, the value of Point of Sales (PoS) deals in 2020 hit an all-time high of N4.7 trillion.

This shows a 46 per cent increase over the N3.2 trillion value recorded in 2019. A breakdown of the monthly value of PoS transactions in the country shows that in January 2020, N313.43 billion worth of transactions were carried out over the PoS, an amount that is 41 per cent higher than the N222.92 billion recorded in January 2019.

In February 2020, the value grew by 69 per cent from N193.43 billion in 2019 to N326.03 billion. In March 2020, N368.86 billion worth of transactions were conducted, an amount which is 70 per cent higher than the N217.46 billion recorded in the same month of 2019.

By April last year, the value of transactions declined slightly to N272 billion, this was. However, higher than the N246 billion recorded in April 2019 by 11 per cent. In May, transactions valued at N358 billion was recorded, a 39 per cent growth over N257.7 billion recorded in the same period of 2019. The value of PoS transactions in June stood at N364.7 billion, which was 48 per cent higher than the N245.9 billion recorded in June 2019.

In July, last year, the value jumped to N416.7 billion, a 49 per cent growth over N279.5 billion recorded in the same period of the preceding year. August transactions value stood at N386.4 billion, which was 31 per cent higher than N294 billion recorded in August 2019. In September, transaction value rose to N404.9 billion, an increase of 42.8 per cent over N283.4 billion recorded in the previous year. By October, the figure rose to N460.9 billion, a 60 per cent growth over N287.8 billion recorded in the same month of 2019.

The is because the reality demands that real-time payments and banking capabilities should be available whenever and wherever they are needed by customers.

Besides, there has been  rise in PoS, Automated Teller Machine (ATM), mobile and internet banking activation and usage across various segments of the economy, including among the unbanked at the base of the society but there are still challenges facing the sector.

Nigeria Interbank Settlement (NIBSS) data showed there are about 307,000 PoS machines in Nigeria, 30,000 ATM, and over 6,000 bank branches. However, majority of the PoS machines, which are fast being accepted by cardholders  are not active. Only 167,000 of the PoS are active and majority malfunction at the point of trial. Many merchants have continued to collect legal fees from cardholders who want to use their cards on PoS.

Many customers have shared their frustrations with the platforms. Stevens Odutola,  an Abuja-based entrepreneur, said he stopped using PoS after the merchants asked him to pay N300 before for using the device.

“I have decided to either make transfers or pay with cash for goods and services because of charges that come with using PoS. I was told by one merchant to add N300 to the cost of goods I bought to cover bank charges. It was not a good experience for me,” he said.

Unity Bank Plc has posted gross earnings of N27.6 billion for its half-year results, representing a growth of 17 per cent year-on-year.

In its unaudited half-year financials submitted to the Nigeria Exchange Group Limited, the bank also made significant improvements across key performance indicators.

The bank grew Profit Before Tax (PBT) by 23 per cent which rose to N1.8 billion from N1.5 billion in the corresponding period of 2021. Profit After Tax (PAT) for the period equally increased by 23 per cent to close at N1.6 billion from N1.382 billion in the last six months.

The key highlights of the financial statements showed growth in interest and similar income, which rose 18 per cent to N23.938 billion from N20.273 billion in the corresponding period of 2021, an indication of sustained growth in the loan book as well as improved earnings from the lender’s robust digital channels, arising from sustained investment in its digital payment infrastructure.

Similarly, the lender posted sustained asset growth as total assets moved up by seven per cent to N574.3 billion from N538.9 billion in 2021.

Other key highlights of the financial statement include a 12 per cent growth in deposits, which rose to N359.5 billion from N322.3 billion in December 2021, an indication of the positive trend of the bank’s innovative retail products targeting several segments of the retail market as well as enhanced customer acquisition strategies for emerging products rolled out to the market during the period under review.

In the same vain, the lender recorded an increase on its loan books to N303.632 billion from N269.270 billion in 2021, representing a 13 per cent growth.

Managing Director/CEO, Unity Bank Plc, Mrs. Tomi Somefun, noted that while the key performance indicators continue on an upward trajectory; PBT (23 per cent year-on-year), total assets (seven per cent year-on-year) and gross earnings (17 per cent year-on-year); the outlook for our financial position has now moderated significantly looking at other fees and income lines which performance was hitherto characterised by volatilities in the operating environment.

“As the bank aims to further grow all indices to double-digit regions in the coming years, one reassuring take from the financial position lies in the market confidence, as well as steadily growing retail and SME franchise arising from the development of products that resonate with different markets segments, which will enable the bank to continue to operate and successfully navigate the tough operating environment, amid rising economic headwinds,” Mrs. Somefun stated.

The Unity Bank boss also stated that having invested massively in technology to drive a major revamp in our digital banking products and channels, including the Unifi Mobile App, our USSD, *7799#, internet banking, among others, the major focus is to drive increased optimisation which will enable the bank to provide electronic convenience in the way we support our teaming customers and market segments and more often change the way they transact business.

In the view of analysts, the key performance indicators showed that the market sentiments are responding positively to the strategies of the lender’s management to accelerate the growth momentum designed for the bank.

Lagos Commodities and Future Exchange (LCFE), Heritage Bank Plc, Capital Market players and other stakeholders have unlocked the $1trillion commodities ecosystem as avenue to diversify the economy from a crude oil dependent economy to other critical economic sectors.

This was made known at the historic inauguration of the Lagos Commodities & Futures Exchange, with the theme, “New Order, Driving Nigeria’s Economy Through the Commodities Ecosystem,” in Lagos.

This feat, according to key stakeholders, would catalyse the economy to create value, wealth restore growth and build global competitive economy.

The Managing Director/CEO of Heritage Bank, Ifie Sekibo, stated that as the Lead settlement bank in partnership with key stakeholders, it considered the launch as huge potential to unlock the opportunities and wealth of the four asset classes – agriculture, solid minerals, oil and gas and currencies.

“I believe that this is the beginning of how we are going to possibly create values in areas that hitherto we have taken for granted. First thing it will bring about is sustainable commodity trading ecosystem, being a catalyst for capital formation, unlocking the long-time financing for the solid mineral and mining space. A frontline push to diversify the economy of this country from oil,” he emphasised.

He affirmed that the promotion of investment in commodities ecosystem by Heritage Bank, in partnership with LCFE in its various assets traded agriculture, solid minerals, oil and gas and currencies would increase liquidity support from local commodity exportation to boost the race for the $200 billion in FX repatriation and reduce the pressure on exchange rate.

Lagos State Governor, Babajide Sanwo-Olu, stated that the inauguration would fulfil the catalysts of growth, which are to attract cutting-edge ideas and innovation and improve the inflow of finance and great ideas that will enable businesses to flourish.

This,  according to him, would improve the living environment, for businesses, and for the investments in Lagos and our country.

Managing Director/CEO, LCFE, Akin Akeredolu-Ale,  said: “As we are all aware, the capital size of the Nigerian commodities ecosystem is so large and as I have said in the past, it can be considered as a $1trillion economy cutting across agriculture, oil and gas, solid minerals and currency. With a capitalisation this large, it was important to lay the right foundation as the means determined the end for us and we could not afford, not to get it right.”

He added: “Nigeria produces only high value, low sulphur content, light crude oils – Antan Blend, Bonny Light, Bonny Medium, Brass Blend, Escravos Light, Forcados Blend, IMA, Odudu Blend, Pennington Light, Qua-Iboe Light and Ukpokiti This makes Nigeria’s crude very desirable.’’

“By way of sovereignty, our oil and gas products should be traded and priced within Nigeria. 400,000bbls on arbitrage can be traded on the LCFE. Whenever prices drop, we can plan for our trades in the future. This will boost the balance sheet, enhance liquidity, and shore up the value of the Naira; External reserve will become both external and internal reserves. The Exchange is currently setting up frameworks and structures to achieve this and more details will unfold in due time,” Akeredolu-Ale explained.

He noted that one of the asset classes in which LCFE has made tremendous giant strides in is the Solid Minerals asset class.

“We noticed there was an urgent need for structure, regulation, funding, and data collation in this sector and this is where Commodities Exchanges play strategic roles in introducing structure to this ecosystem,” he stated.

United Bank for Africa (UBA) Plc has rewarded 20 kids with N200,000 each as scholarship grants in its Kiddies & Teens Draw in Lagos.

They are Anderson Andikan Nathan, Salihu Yakubu Mahamud, Simeon Thankgod Ofomona, Nwaeze Annabel Chiziterem, Eva Favour Emmanuga Makuachukwu, Ifechukwudi Divine Ugbeh, Jeremiah Unekwuojo Isyaku, Iyare Francesca Owa and Okoye Gerald Munachi.

Others are Charles-Agwanyokha Salvation Ilamosi; Ngbede Godswill Ishor; Molokwu Ezidinma Kosisochukwu; Nancy Esohe Aigboduwa; Alika Anwuli Erika; Funebi j Tapre; Ebubechukwu Goodluck Ephraim; Uchegbu Benedicta Chidera; Ireoluwa David Aderinola; Njoku Chinecherem Judith and Mariam Odunayo Oyewole.

They won because their parents/guardians maintained N10,000 in their child/ward’s UBA Kiddies or Teens Accounts for six months.

The draw is an innovative initiative by UBA to inculcate a Savings culturein kids and teens and, ultimately, actualise their dreams.

The virtual draw was witnessed by the representatives of the National Lottery Regulatory Commission (NLRC) and the Consumer Protection Council (CPC).

A winner, Okoye Gerald, whose father was contacted over the phone, said: “Thank you UBA. This is very thoughtful coming from the bank. It goes a long way in showing that UBA is indeed passionate and dedicated to the growth of its customers and their children. A bank that grooms the young is indeed a wise bank.’’ Altraide advised parents who had yet to open accounts for their kids to do.

UBA’s Head, Personal Banking, Ogechi Altraide, said: “I will like to let you know that this is another first from UBA, and of course, we are very excited at this because it again goes to show that we take very seriously the mandate of ensuring financial inclusion and this time, we are catching them young and ensuring that as they grow they become discipline and can fuel their dreams to a happy end, which exactly what we are passionate about as a bank.

”We know that the kids today are the future of tomorrow, and we are trying to groom them to imbibe the habit of savings, so that they can achieve their dreams as well as secure their future while putting away something for the future.”

Also, Head of Marketing, Diana Ubah, added: “Our bank has continued to show and prove that, we are passionate about the overall growth and success of every customer and that is why we go ahead of others to innovate and come out with initiatives that are unique and can transform the lives of our customers for good.

“In a tap-and-go society where money is rarely physically exchanged and quicker to spend, it is important to educate young people about the value of money. By including your kids so that they see how you spend money, it will help develop a basic understanding of transactions in the real world, as they grow up in an increasingly digital economy.’’

The UBA Kiddies is an account designed for children between zero and 12 years while UBA Teens Accounts is between 13 and 17.

Beneficiaries earn 13 months reward of 10 per cent of the monthly savings plan for over 12 months, having maintained a minimum of N5,000. They also have a chance to partake in a scholarship scheme through a raffle draw, having maintained a saving a minimum of N10,000 for six months. The account has a yearly interest of 1.15 per cent paid monthly.