The Nation Newspaper

Tag: agency banking

  • Taking agency banking to grassroots

    Commercial banks are increasingly targeting the unbanked in the society through agency banking, which has helped them to cut their cost of operation and reach more people at the grassroots. COLLINS NWEZE writes that the new move is in line with the Central Bank of Nigeria’s (CBN’s) financial inclusion mandate to deposit banks.

    Since the Central Bank of Nigeria (CBN) unveiled the frame work for agency banking, lenders have increasingly deployed the channel to expand their financial intermediation role.

    The objective of agency banking is to enhance financial inclusion, make financial services delivery channel efficient and take banking to the grassroots.

    According to the CBN, agency banking takes financial services to customers through a third party (agent) on behalf of a licensed deposit taking financial institution and/or mobile money operator (principal).

    To qualify as an agent for specific banking operations, on behalf of deposit financial institution or mobile money operator, the agent must be an entity that has been in a legitimate commercial activity for at least one year before the date of the application, and the business must be a going concern, the CBN said.

    According to the CBN, commercial banks have continued to embrace agency banking to improve their customer base and support their cost-saving strategies.

    To this end, Keystone Bank Plc has signed a partnership with the Nigerian Postal Service (NIPOST) and IONEC Limited, to provide agency banking services to existing and intending customers to bring more people into the banking system. The initiative was christened ‘KeyServ’.

    KeyServ offers services such as Account Opening, Bills Payment, Cash-In, Cash-Out, ATM Services, Fund Transfers, Balance Enquiries, ATM cash withdrawals, Mini Statements and a whole lot more.

    The platform seeks to leverage NIPOST’s networks and locations across the country to provide access to financial services to many Nigerians, particularly the youth and rural dwellers who are excluded from financial services.

    The platform is a complementary effort of the bank towards encouraging the financial inclusion drive of the CBN.

    Under the arrangement, NIPOST will through its Post Outreach system, provide outlets in different locations using people’s houses as offices for banking services while the house owner becomes an agent of the bank.

    IONEC Limited on the other hand, acts as the technical partner providing the needed technical input for the success of the operation.

    With its agency banking already operative in Lagos, Kano, Edo and other states in the country, the bank has made Automated Teller Machines available to enable customers in the locations withdraw and deposit money with ease.

    Speaking at the launch of the platform in Lagos, Managing Director, Keystone Bank Plc, Obeahon Ohiwerei, said the three partners had through the initiative succeeded in democratising banking in Nigeria, stressing that with the agency banking, the bank can be able to take banking services to everywhere in the country.

    “This is just a simple solution that is riding on the platform of NIPOST. So, we’re going to replicate this action, riding on this collaboration to take banking services to every state, every local government, and every area in Nigeria. And what it means is that the country itself stands to benefit largely from it,” Ohiwerei said.

    He added: “And we heard that about 40 million adults are not banked today in Nigeria. So, what does that tell you? If we’re able to attract half of that using this platform, and each person banks an average of N10, 000, it then means that you have fully 200 million into the banking system and that has several implications for the society.”It means that if such money is available it can be applied to the key sectors of the economy we can lend more money; we can provide more services.”

    Also speaking at the event, NIPOST’s Post Master-General , Bisi Adegboye, said the partners would use the mutually beneficial platform, which rides on technology to ensure that more Nigerians were captured.

    “The philosophy behind it is that Keystone is the principal. Whatever you can do in any of the Keystone branches in Nigeria, we can help you to do it in any of our locations. What we are providing them is our networks in the country,” Adegboye said.

    He explained that the agency banking window provided by the bank would in no small way benefit people living in the rural areas.”Going by the demographical architecture of this country, the greater percentage of this country lives in the rural areas. I know what our people in the rural areas go through.”They are underserved, they are unbanked, they are excluded from the formal financial ecosystem that the elites of this society operate. They will benefit greatly from this platform.”

    Lending his voice, Managing Director, IONEC, Kelechi Dozie, said: “This tripod will not be here without NIPOST and without the vision of Keystone Bank. When we started this journey with NIPOST over a year and half ago, we needed a bank that has a vision to believe in bringing services to the poor, the financially excluded and the unbanked, and that bank is Keystone Bank.”

    Also, the Executive Director, Corporate Banking & South, Keystone Bank, Yemi Odusanya, added that “with this scheme, customers, especially in the rural areas will enjoy unfettered access to banking services. As at today, we have about 106 approved agents across the country.”

    Nevertheless, a report by Enhancing Financial Innovation & Access (EFInA) had pointed out possible challenges which should be addressed in order to strengthen the agency banking operations in the country.

     

  • Agency banking: Keystone Bank, NIPOST partner

    Keystone Bank Limited yesterday launched ‘KeyServ’, an Agency Banking Proposition to serve customers outside its conventional brick and mortar mode of banking.

    The initiative, which is in partnership with Nigerian Postal Service (NIPOST) and i-OneC, a financial technology firm, is in line with the Central Bank of Nigeria’s (CBN’s) Financial System Strategy (FSS 2020) goals to increase financial inclusion uptake in Nigeria.

    According to the Group Managing Director/ Chief Executive Officer of Keystone Bank Limited, Obeahon Ohiwerei: “Enabling Financial Inclusion is our core area of focus and we have partnered with other industry players to deploy Digital Financial Solutions/ Platforms for improved access to finance; leveraging data to improve the product offerings, personalised and predictive customer service, and uncovering new customer segments”.

    The recent reports on adult Nigerians, according to Enhancing Financial Innovation & Access (EFInA), is that 40.1 million is financially excluded. That represents 41.6 per cent of 96.4 million adults. “To this end, we are partnering with NIPOST and i-OneC to offer financial inclusion services to un(der)banked Nigerians especially in the rural and less urban areas.”

    Under this partnership, KeyServ (Keystone Agency Banking Services) offers services such as account opening, bills payment, cash-in, cash-out, Automated Teller Machine (ATM) Services, fund transfers, balance enquiries, ATM cash withdrawals, mini statements and a whole lot more.

    “One landmark feature of KeyServ (Keystone Agency Banking Services) is that it offers affordable access to financial services than the traditional banking methods” Ohiwerei reiterated.

    Also, speaking at the launch, the Executive Director Corporate Banking & South, Keystone Bank, Yemi Odusanya, added that “with this scheme, customers, especially in the rural areas will enjoy unfettered access to banking services.

    As at today, we have about 106 approved agents across the country and already, the services are available at Sabongida-Ora (Evbiobe)-Edo State,  Sabon Gari (Kano), Mirinjibi (Kaduna), Barnawa (Kaduna), Yaba (Lagos) and Ikoyi (Lagos)”.

    It’s simply convenient, affordable and several NIPOST locations nationwide have been earmarked to feature actively in this initiative. Nigerians now have the opportunity to take full advantage of this partnership to enjoy the bouquet of financial services across the country.

  • Unity Bank takes ‘Agency Banking’ to Kano, Jigawa

    Unity Bank takes ‘Agency Banking’ to Kano, Jigawa

    Unity Bank has commenced its agency banking services in Kano and Jigawa states. Theexcercise is expected to bring manyof the unbanked into the financial services net.

    In line with Central Bank of Nigeria’s financial inclusion mandate, Unity Bank targeted its Agent Banking services at Gumel in Jigawa state and Rijiya-Lemu in Fagge Local Government area of Kano state.

    According to the General Manager Products & Channels Directorate of Unity Bank, Bonaventure Okhaimo, prioritizing the North West was borne out of the need to tap into the huge unbanked population in the region.

    Agent Banking model is conceptualised to evolve as a model of community and rural banking where basic banking services are brought to the level of rural financial activities, said Bonaventure.

    The roll-out, which witnessed the opening of many Agency outlets in the areas, was attended by numerous locals, customers and prospects, who were all excited to be able to avail themselves of financial services without travelling long distances to a bank branch.

    The customers were able to open accounts with Unity Bank, perform cash-in (deposit), cash-out (withdrawal) as well as bills payment transactions at the new Agent Banking outlets. With the bank’s digital account opening portal – Unity1 Online – new tier-1 accounts can be opened for customers without any need for identification. The whole process takes less than 4 minutes. Customers are advised of their NUBAN account numbers immediately, and are able to start transacting straightaway; in fact, once they provide their Bank Verification Numbers (BVN), they have full access to their accounts.

    The bank’s Group Head, Retail & SME Banking, Olufunwa Akinmade, explained that an important part of the roll-out in any location, is a two-day customer education session organized to bring customers up to speed with the basic tenets of the scheme.

    On the security of the customers’ funds, Mr. Akinmade said that the mitigant on the withdrawal side is that  the service is running on MCash-a secure phone-based withdrawal system backed by the Nigeria Inter-Bank Settlement Systems (NIBSS) while at the deposit end, the customer must receive an alert to be sure that the transaction has been consummated.

     

     

  • Taking agency banking to new heights

    The promotion of agency banking is one of the principles adopted by the Central Bank of Nigeria (CBN) and commercial banks to take banking to the grassroots. First City Monument Bank (FCMB) has not only promoted the agency banking model, but increased its commitment to agricultural financing to ensure that people at the grassroots, who are mainly farmers, have access to financial services. This is in line with the government’s plan to create jobs and wealth for the people, writes COLLINS NWEZE.

    The majority of Nigerians in rural areas do not have access to financial services. The Central Bank of Nigeria’s (CBN’s) introduction of agency banking is aimed at connecting rural dwellers to the financial system.

    Many commercial banks have joined the CBN to promote agency banking and fund agriculture at the grassroots. First City Monument Bank (FCMB) is one of them.

    A banking agent is contracted by a commercial bank and approved by the CBN to provide specific services for the bank. The agent is equipped with the skills necessary to provide basic banking services according to set  standards.

    The FCMB has reiterated its commitment to assisting the Federal Government in achieving its development goals.

    This is because it is believed that the main task of governance all over the world is to provide social and economic infrastructure, protect life and property, and also create employment for the unemployed.

    The need for economic development through poverty reduction, employment generation and wealth creation must be given priority by government. But to what extent can this responsibility be left to the government alone?

    The FCMB, which has been in operation for 34 years, believes the responsibility should not be left to the government alone. Since Nigeria is blessed with favourable climatic conditions, ample arable land and fertile soils, some solution has been proffered.

    The bank is empowering small holder farmers as well as micro, small and medium scale enterprises which are the powerhouse of developed economies.

    In Nigeria, the Federal Government has concluded plans to align its fiscal, monetary and trade policies to stimulate economic growth.

    FCMB’s Managing Director, Adam Nuru, said the lender has an objective that enables it to partner with the government in various  economic activities that impact positively on the people. Such areas include the micro, small and medium enterprises which are key to economic growth.

    In one of the economic outreaches championed by FCMB, Nuru said: “The bank has designed a group lending programme which aims at creating financial awareness and empowerment for financially active women through micro-credits, procurement and deployment of Point of Sale (PoS) and free mobile phones among these women.

    “These women have been identified in self-organised and homogenous groups that provide support and peer pressure to reimburse loans. It is quite innovative in Nigeria.  Our focus on this aspect with the accruing benefits, are the unbanked, under-banked and low income customer segments who are also being acquainted with financial inclusion.’’

    The bank, he said, is committed to bringing financial services closer to both urban and rural small income earners. This enables them access loans in groups to be able to drive inclusion.

    “The scheme also offers more flexible financial services to small income earners in the market especially women to increase their work capital. It is another opportunity that enables small income earners expand their asset base to finance their household needs,” he stated.

    The bank has sinplified its lending to the people. For the upcoming, small and medium sized businesses to benefit, prospective participants must be between 18 and 60 and belong to a group. The group’s size must be five to 25 members who enjoy mutual trust, confidence and respect, and live or work in close proximity to one another.

    “The customer must have an income generating activity or business which has been in existence for at least six months. The borrower must exhibit the potential to save. And Group members are expected to be residing within a radius of one kilometre. FCMB is also offering free four weeks of training organised for borrowers before loans’ disbursement,” Nuru said.

    Vice-President Yemi Osinbajo, disclosed that the government’s success at restoring growth depends on improved macroeconomic conditions. Hence, fiscal, monetary and trade policies are being aligned to stimulate the economy and support growth while preventing overheating.

    Also, sectoral policies were being implemented by the Federal Government to diversify the economy by boosting investments in agriculture, manufacturing, mining, construction and the digital economy. The Deposit Money Banks, Osinbajo noted, were vital to the implementation of the government’s Economic Recovery and Growth Plan (ERGP).

    At the donation of a robust Home Grown School Feeding (HGSF) programme web portal developed by FCMB for deployment nationwide to the Federal Government,  Nuru informed Osinbajo that the bank, as one of the top lenders in Nigeria, is already providing financial and technical advisory support to several operators in various sectors.

    He listed these to include power sector projects, export trade, Small and Medium Scale Enterprises (SMEs), among others. ‘’We will continue to intervene and offer support as well as solutions in developmental areas that would fast-track the growth of the aspirations of individuals, businesses and the country in general,’’ he added.

    Also, FCMB’s Microfinance project from inception, set the pace for rural and semi-urban economic prosperity and the resultant effect, has been profound. The Microfi-nance Bank (MfB) also developed a robust software application for online real time transaction and reporting. It has also commenced Bank Verification Number (BVN) registration for microfinance banks’ clients with credit check on customers for improved loan assessment process.

    The MfB’s operation is in operation in 53 branches covering 11 states in five geopolitical regions. The FCMB Group Lending and Agency Banking projects are a digitised credit and savings solution which facilitates instant account opening with debit card issuance for online real time transactions driven by PoS and mobile devices.

    Group Chief Executive of FCMB Group Plc, Ladi Balogun, said: “The bank’s project is driving financial inclusion in Nigeria through the deployment of agents in communities without financial service providers. The project is highly driven by technology to create a distinct offering from other existing micro lending businesses.The automation of loan processing, disbursement, and repayment via PoS and/ or mobile solutions ensures an efficient and swift loan disbursement and collection process.’’

    In agriculture, it is a concern, however, that as desirable as agriculture is to economic well-being, Nigeria is yet to maximise its potential.

    FCMB’s intervention in the agric  sector has left a far-reaching impact on this crucial part of the economy.

    Tractor Owners and Hiring Facilities Association of Nigeria (TOHFAN) Chairman, Danladi Garba, praised FCMB for its support to the agric sector and farmers in Lagos.

    FCMB had provided funding worth N300 million to TOHFAN for the acquisition of tractors that were distributed to operators and benefiting farmers throughout Nigeria.

    The bank also collaborated with Doreo Partners, an impact investing firm with a proven track record of exclusively investing in profitable, high growth, early stage businesses that improve the livelihoods of Nigerian smallholder farmers, to launch a support programme for farmers, known as Babban Gona (or ‘’great farm’’).

    This is an agricultural franchise model, where farmers are trained, provided end-to-end support, and offered specially packaged loans to carry out their farming.

    In line with its commitment to financial inclusion, which entails bringing the underbanked and unbanked population into the financial system, a drive which the CBN has been pursuing actively, FCMB selected a region with a high degree of financial exclusion, bringing on board farmers in the Gimba, Soba and Maigana communities.

    The franchise has about 18000 farmers, developed by Doreo Partners and has a vision of reaching in excess of a million farmers in the near future

    Another testimony associated with FCMB is the success of Psaltry International Farm in Ado-Awaye, Iseyin in Oyo State, whose achievements in cassava business and agric value chain management have assumed international dimension.

    Managed by Mrs. Yemisi Iranloye, a biochemist and agric entrepreneur, the business has a farming base of over 10,000 hectares of land with about 2,000 out-growers. It also has a factory that processes cassava to food grade starch for supplies to large corporates in the food and beverage industries.

    FCMB’s facilitation of about N1billion for Psaltry Farm under the Central Bank of Nigeria’s (CBN’s) funding schemes for the sector has given the Iseyin agric community the much-needed economic boost.

    Apart from FCMB’s relationship with Psaltry, the bank partnered  the farm to provide basic agricultural training for its farmers to understand the technical details of growing their produce for higher yield and improved income.

    FCMB distinguishes itself by its extraordinary people and culture, a customer-focused and performance-driven environment.Its unique retail lending capabilities enables it to offer valued services to millions of underserved Nigerians, while supporting its portfolio diversification objectives to deliver sustainable growth. Its investment and transaction banking services further distinguish it as a bank for companies, doing business within and outside Nigeria, with customers in need of value-added solutions.

    The bank’s distinctive capabilities and culture provide it with the critical elements for sustained growth and the competitiveness to fulfill its mission.

    With these, among others, the Federal Government, has called on other financial institutions as well as other patriotic individuals to join FCMB to add value for national empowerment and economic development.

     

  • Why we pioneered agency banking in Nigeria, by Ecobank

    Why we pioneered agency banking in Nigeria, by Ecobank

    The decision of Ecobank to introduce agency banking in the country is part of the bank’s distribution strategy to take banking service to the door-step of the customers.

    According to the Head, Cards and e-Banking, Ecobank Nigeria, Ayotunde Kuponiyi, Ecobank Agency Banking service which is the first of its kind to debut in the country is also targeted at offering affordable access to financial services, adding that, it would simplify and engender flexibility in banking operations.

    He explained that Agency banking services is designed to increases the bank’s retail distribution network allowing it provide basic banking services to its customers as well as offer payment services such as bank transfers, bill payments and airtime top-up to the general public.

    “This is part of the bank’s distribution strategy to take banking service to the door-step of the customer. We are extending our banking services to consumers’ neighborhood to offer even greater convenience and accessible financial services in a cost effective and secure manner,” he said.

    He maintained that every hand is on the deck to make it a success, urging members of the public to patronize the accredited agents.

    It would be recalled that Ecobank Nigeria commenced agency banking services recently, enabling its appointed agent partners carry out banking services on its behalf, so as to offer basic banking services to the underbanked by providing extended hours for available banking services in the customers’ neighborhood.

    The listed agent partners already offering this service in Lagos as Buymore Supermarket chain (in Agungi-Lekki, Kilo Surulere, Ikeja GRA), Kenzo Retail Supermarket chain (in Lekki, Festac and Apapa) and Save-a-Lot Supermarket in Egbeda.

    Banking services provided by the agents banking locations include opening Ecobank Quick Account, cash withdrawal and deposit into Ecobank accounts; funds transfers into any bank account in Nigeria, bills payment (utilities, cable subscription, etc), mobile phone airtime top up amongst other services.