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Tag: financial inclusion

  • Fed Govt signs MoU with six bodies to train 10m Nigerians in financial inclusion

    Fed Govt signs MoU with six bodies to train 10m Nigerians in financial inclusion

    A free nationwide training  targeting 10 million Nigerians on financial inclusion and financial literacy was kicked off yesterday by the Federal Government with  the signing of a Memorandum of Understanding (MoU) with six professional bodies.

    The programme, being implemented by the Office of the Vice President through the Presidential Committee on Economic and Financial Inclusion (PreCEFI), is designed to empower Nigerians, particularly youths and women, with essential financial skills, investment knowledge and digital competencies for sustainable wealth creation.

    Under the MoU, the Federal Government will collaborate with the Institute of Chartered Accountants of Nigeria (ICAN), the Chartered Institute of Bankers of Nigeria (CIBN), the Chartered Institute of Stockbrokers, the National Institute of Credit Administration (NICA), the Chartered Risk Management Institute (CRMI) and the Nigeria Institute of Innovation and Entrepreneurship (NIIE) to jointly design training programmes, certification pathways, digital skills initiatives and mentorship platforms.

    Speaking at the kick-off ceremony at the Presidential Villa, Abuja, on behalf of President Bola Ahmed Tinubu, the Vice President Kashim Shettima described the agreement as more than a formal document.

     Shettima  said Nigeria would only reap bountifully from its demographic dividend if young people and women were deliberately equipped with relevant skills and strong ethical grounding to thrive in a rapidly evolving digital economy.

    In a statement  by Senior Special Assistant to the President on Media and Communications, Office of the Vice President, Stanley Nkwocha, Shettima said: “It is a strategic national investment in capacity as infrastructure—the human, institutional and ethical foundations upon which inclusive growth must rest”.

    Read Also: PalmPay seeks deeper financial inclusion

    He explained that the Aso Accord on Economic and Financial Inclusion, which PreCEFI is mandated to implement, recognises that financial inclusion goes beyond access.

    “Financial inclusion is not achieved by access alone, but by competence, trust and capability. We cannot build a one-trillion-dollar economy on weak skills, fragmented standards or disconnected professional ecosystems,” he said.

    According to him, the framework created by the MoU would harness the collective expertise of the professional bodies to advance inclusion through capacity building, advocacy, digital transformation, youth empowerment and support for small and medium practitioners.

    Shettima stressed that inclusion would remain a slogan without professionals who understand MSME formalisation, credit risk beyond collateral, consumer protection, digital risk management and innovation-driven enterprise development.

    He urged PreCEFI and the partner institutions to treat the MoU as a “living platform for execution” rather than a ceremonial agreement.

    “On behalf of President Bola Ahmed Tinubu,  I hereby flag off the free training of 10 million Nigerians, with priority for women and youth across the country,” the Vice President declared.

    In his remarks, the Technical Adviser to the President on Economic and Financial Inclusion, Dr Nurudeen Abubakar Zauro, said exclusion was often driven by limited skills and weak institutional capacity rather than lack of access alone.

    “Financial inclusion is achieved when people and institutions are equipped to use infrastructure responsibly, productively and sustainably,” he said.

    Earlier, the President of the Institute of Chartered Accountants of Nigeria, Mallam Haruna Nma Yahaya, hailed the Tinubu administration’s economic reforms, saying visible improvements in the economy informed the decision to support the initiative.

    He assured the government of the professional bodies’ commitment to the success of the programme, describing their participation as an institutional honour.

    Also, Chief Executive Officer of WAWU Africa, the technical partner for the programme, Mr Emmanuel Lennox, pledged the organisation’s readiness to deliver the digital platform and enabling environment required for the project.

  • FG signs MoU with six professional bodies to train 10m Nigerians on financial inclusion

    FG signs MoU with six professional bodies to train 10m Nigerians on financial inclusion

    The Federal Government on Monday flagged off a free nationwide training programme targeting 10 million Nigerians on financial inclusion and financial literacy, following the signing of a Memorandum of Understanding (MoU) with six professional bodies.

    Vice President Kashim Shettima said Nigeria would only reap bountifully from its demographic dividend if young people and women were deliberately equipped with relevant skills and strong ethical grounding to thrive in a rapidly evolving digital economy.

    The programme, being implemented by the Office of the Vice President through the Presidential Committee on Economic and Financial Inclusion (PreCEFI), is designed to empower Nigerians, particularly youths and women, with essential financial skills, investment knowledge and digital competencies for sustainable wealth creation.

    Under the MoU, the Federal Government will collaborate with the Institute of Chartered Accountants of Nigeria (ICAN), the Chartered Institute of Bankers of Nigeria (CIBN), the Chartered Institute of Stockbrokers, the National Institute of Credit Administration (NICA), the Chartered Risk Management Institute (CRMI) and the Nigeria Institute of Innovation and Entrepreneurship (NIIE) to jointly design training programmes, certification pathways, digital skills initiatives and mentorship platforms.

    Speaking at the flag-off ceremony at the Presidential Villa, Abuja, on behalf of President Bola Ahmed Tinubu, the Vice President described the agreement as more than a formal document.

    In a statement by Senior Special Assistant to the President on Media and Communications, Office of the Vice President, Stanley Nkwocha, Shettima said “it is a strategic national investment in capacity as infrastructure—the human, institutional and ethical foundations upon which inclusive growth must rest”.

    He explained that the Aso Accord on Economic and Financial Inclusion, which PreCEFI is mandated to implement, recognises that financial inclusion goes beyond access.

    “Financial inclusion is not achieved by access alone, but by competence, trust and capability. We cannot build a one-trillion-dollar economy on weak skills, fragmented standards or disconnected professional ecosystems,” he said.

    According to him, the framework created by the MoU would harness the collective expertise of the professional bodies to advance inclusion through capacity building, advocacy, digital transformation, youth empowerment and support for small and medium practitioners.

    Shettima stressed that inclusion would remain a slogan without professionals who understand MSME formalisation, credit risk beyond collateral, consumer protection, digital risk management and innovation-driven enterprise development.

    Read Also:Okpebholo orders grassroots Mobilisation for Tinubu’s re-election

    He charged PreCEFI and the partner institutions to treat the MoU as a “living platform for execution” rather than a ceremonial agreement.

    “On behalf of President Bola Ahmed Tinubu, GCFR, I hereby flag off the free training of 10 million Nigerians, with priority for women and youth across the country,” the Vice President declared.

    In his remarks, the Technical Adviser to the President on Economic and Financial Inclusion, Dr Nurudeen Abubakar Zauro, said exclusion was often driven by limited skills and weak institutional capacity rather than lack of access alone.

    “Financial inclusion is achieved when people and institutions are equipped to use infrastructure responsibly, productively and sustainably,” he said.

    Earlier, the President of the Institute of Chartered Accountants of Nigeria, Mallam Haruna Nma Yahaya, commended the Tinubu administration’s economic reforms, saying visible improvements in the economy informed the decision to support the initiative.

    He assured of the professional bodies’ commitment to the success of the programme, describing their participation as an institutional honour.

    Also speaking, Chief Executive Officer of WAWU Africa, the technical partner for the programme, Mr Emmanuel Lennox, pledged the organisation’s readiness to deliver the digital platform and enabling environment required for the project.

    The highlight of the event was the formal signing of the MoU between the Federal Government and the six professional bodies for the nationwide capacity-building programme.

  • How the fintech boom is revolutionising financial inclusion

    How the fintech boom is revolutionising financial inclusion

    In recent years, Nigeria’s fintech sector has evolved at a rapid pace, introducing innovative digital solutions that are transforming the landscape of financial transactions. These fintech companies have disrupted traditional banking by offering convenient, user-friendly platforms that enable seamless transactions for both individuals and businesses. With the rise of Point-of-Sale (PoS) systems and digital payment platforms, many Nigerians, including those in rural areas, have gained easier access to financial services. ALAO ABIODUN explores how fintech companies are emerging as formidable rivals to Nigeria’s traditional banks

    For 42-year-old Mrs. Kemisola Akano, a market seller in the Ikotun area of Lagos State, partnering with a fintech firm, Moniepoint, has transformed her business operations. “Before now, I faced constant challenges receiving payments from customers. Some would make fake transfers, while others struggled with transferring to my regular account. Since I got Moniepoint’s point-of-sale (POS) machine, my business transactions have been seamless,” she said with relief.

    Her experience underscores the vital role fintech firms play in bridging financial gaps, particularly during a period of banking network disruptions. Since September, bank customers across Nigeria have faced difficulties accessing their funds and completing transactions due to persistent outages in core banking applications. Frustrated customers have expressed how these disruptions have not only hindered their activities but also eroded trust in traditional banking institutions, which many see as the cornerstone of financial stability.

    Fintech firms like Moniepoint, however, have stepped in to fill the void. With a network of agents nationwide, these companies are reshaping financial inclusion by offering accessible and affordable services to the unbanked and underbanked population. Digital banking, often described as traditional banking in a digital form, has struggled to meet the expectations of customers due to inconsistent service delivery. In contrast, fintechs have thrived by leveraging innovative technology and a decentralised model to meet the needs of everyday Nigerians like Mrs. Akano.

    While banks struggled to adapt to the naira redesign and related pressures, fintech companies experienced a surge in demand, as many Nigerians turned to them for daily transactions. Checks by The Nation reveal that Sterling Bank was among the first to experience prolonged downtime, which began in September and reportedly lasted over five days. The disruption followed the bank’s switch from its T24 core banking application to SEABaaS, a platform developed specifically for the African market by Peerless. Sterling touted SEABaaS as a tailored solution, but the transition came with significant challenges.

    Other banks soon faced similar hurdles. GTBank transitioned from Basis/Banks software to Finacle in September, following a decision made in September 2023. Zenith Bank also upgraded its core banking system, moving from Phoenix to Flexcube. Initially, Zenith Bank assured customers that its downtime would be brief, spanning just five hours on September 29 for “routine maintenance.” However, users reported prolonged issues. Access Bank followed suit with a scheduled downtime from October 12 at 10 PM to October 13 at 6:30 AM. The bank announced that the interruptions, which impacted services like the Access More app, internet banking, and ATMs, were part of a comprehensive system upgrade to enhance functionality.

    These transitions, while aimed at improving operational efficiency, left customers frustrated, eroding trust in traditional banks. The situation created an opportunity for fintech firms to step in, offering more reliable and accessible services. As banks grappled with outages, fintechs thrived, consolidating their role as essential players in Nigeria’s evolving financial landscape. Amid the banking downtime, many Nigerians turned to fintech platforms like OPay, PalmPay, and Moniepoint for their financial transactions. OPay, owned by Chinese billionaire Yahui Zhou through Opera, has emerged as a popular alternative for money transfers and bill payments, particularly during periods of cash shortages.

    The fintech sector in Nigeria has experienced explosive growth, with increasing investments aimed at expanding service offerings. These platforms have gained traction with the country’s youth, tech-savvy individuals, and even older adults using internet-enabled smartphones. However, in an era of rising internet fraud and online scams, experts warn of the risks associated with relying entirely on digital banks and fintech solutions.

    For many Nigerians, fintechs are seen as “life-savers.” Business owners and Point of Sale (POS) operators, in particular, rely on these platforms for seamless transaction processing where banks often falter. Among them, Moniepoint has garnered significant attention following a $110 million Series C investment led by Development Partners International’s ADP III fund, alongside Google’s Africa Investment Fund and Verod Capital. This investment, which valued Moniepoint at $1 billion, solidified its unicorn status. Moniepoint, founded by Tosin Eniolorunda and Felix Ike in 2015 as TeamApt, initially built software for traditional banks. By 2019, it secured a licence for agency banking, allowing it to bridge gaps between banks and customers. The platform has since grown exponentially, handling 5.2 billion transactions worth over $150 billion in 2023. By early 2024, Moniepoint had onboarded 2.3 million businesses using its payment machines.

    With its new funding, Moniepoint aims to accelerate its pan-African expansion, creating an integrated platform for businesses across the continent. The platform’s success highlights the vital role fintechs play in providing reliable alternatives and enhancing financial inclusion in Nigeria. In June 2023, Moniepoint ranked as Nigeria’s second-largest player in the point-of-sale (POS) agent network, holding a 20% market share. Its closest competitor, the Chinese-owned fintech OPay, backed by SoftBank Vision Fund and Sequoia Capital China, led the market with a 37% share, according to the Nigerian Financial Services Report.

    Despite being a runner-up in POS dominance, Moniepoint has aggressively expanded its offerings. In August 2023, it entered the personal banking market, achieving a staggering 2,000% growth in personal finance customers over the past year. Its revenue growth has also been impressive, with a compound annual growth rate (CAGR) exceeding 150% in recent years. Currently, Moniepoint processes over 800 million transactions monthly, with a total value surpassing $17 billion. This rapid growth and consistent performance have solidified its position as one of Africa’s leading fintech companies.

    Explaining the investment appeal of Moniepoint, Adefolarin Ogunsanya, Partner at Development Partners International, described it as one of Africa’s most exciting and fastest-growing firms. “Moniepoint is well positioned to continue its impressive growth trajectory while driving financial inclusion for underserved businesses and individuals across Africa. DPI has a long-track record of supporting businesses like Moniepoint to achieve their next stage of scale.

    “The company’s combination of innovative technology, fast growth, and positive impact on the continent underpins our conviction in its future success. We look forward to working closely with Tosin and his talented team to expand Moniepoint’s customer base by providing businesses and individuals with first-class banking and payments services,” Ogunsanya stated.

    Fintech companies in Nigeria have gained significant traction by offering user-friendly apps that provide a wide range of services, including loans, savings, investments, and seamless financial transactions. This growth has been particularly notable during periods of economic stress, such as the recent naira redesign and cash shortages, which pushed many Nigerians toward alternative financial platforms.

    The competition within Nigeria’s fintech market has intensified as consumers are presented with a growing number of options. Start-ups are vying for customer loyalty through innovative solutions and enhanced user experiences. According to a McKinsey & Company report, Africa’s fintech industry is rapidly expanding despite political and economic challenges, with the sector’s revenue expected to reach $230 billion by 2025. These companies are increasingly dominating the financial services landscape by offering accessible and efficient payment solutions.

    An analysis of fintech app performance on the Google Play Store highlights their rising popularity. Unlike Nigeria’s commercial banks, none of which have surpassed 10 million downloads, fintech apps are attracting a significant user base. This suggests a shift in consumer preference toward fintech platforms as they address gaps in traditional banking services and cater to the evolving needs of customers.

    As of November 2024, several fintech apps in Nigeria have recorded impressive download numbers on the Google Play Store, reflecting their popularity and adoption among users. These include Moniepoint, which has achieved over 5 million downloads, and Paga, with over 1 million downloads. Piggyvest, another favourite, also boasts more than 1 million downloads, while Carbon and Kuda each have over 5 million downloads. Other notable apps include Okash, Palmcredit, PalmPay, Fairmoney, and OPay, each with over 10 million downloads, showcasing their dominance in the sector. JumiaPay and Smartcash PSB have similarly garnered significant traction, each crossing the 5 million download mark. Renmoney, a financial services platform, has achieved over 1 million downloads.

    In June 2024, the Central Bank of Nigeria (CBN) lifted the restriction on new account openings for OPay, Moniepoint, Kuda, PalmPay, and Paga. This decision followed an earlier directive in April 2024, where the CBN had instructed these five fintech firms to pause onboarding new customers. The temporary suspension was part of a broader initiative to address fraud and ensure stricter compliance within the rapidly growing fintech industry.

    “It is imperative to reiterate that OPay strictly adheres to the approved KYC verification processes and urges our esteemed customers to ensure that the due verification processes are followed for all accounts and all requirements are completely fulfilled,” a statement on OPay’s social media handles read.

    Lifting the ban could be linked to the fintechs satisfying KYC standards required by the CBN. The CBN froze 1,146 bank accounts linked to unauthorised forex transactions. In May, the neobanks met with the National Security Adviser (NSA), the Economic and Financial Crimes Commission (EFCC), and the CBN to discuss lifting the ban on new customer onboarding. Authorities mandated the neobanks to restrict peer-to-peer crypto transactions. They were also instructed to update customer details and require bank verification or national identity numbers for all tiered accounts.

    Stream of investments into fintech sector

    The National Bureau of Statistics reports that Nigeria’s banking sector contributed 16.36% to the nation’s real GDP in Q2 2024, up from 2.98% in Q1. The sector faces increasing competition with recent payment-service banking licences granted to MTN Nigeria and Airtel Africa, joining Globacom’s Money Master and 9Mobile’s 9PSB. This positions all four major telecom operators to offer banking services, further transforming the financial landscape.

    Fintech start-ups have fuelled growth in alternative lending, offering investors higher yields and borrowers faster, cheaper loans. Companies like Carbon and Branch provide lower interest rates by avoiding the operational costs of traditional banks. Among the standout players is Flutterwave, valued at $3 billion, making it Nigeria’s most prominent payment company. Founded in 2016 by Olugbenga Agboola and Iyinoluwa Aboyeji, Flutterwave facilitates online payments for merchants and businesses, attracting global investors like Visa and securing a $250 million investment in 2021 to expand its African footprint.

    Despite rapid growth, Nigeria’s fintech sector grapples with challenges, including regulatory barriers, ambiguous policies, public mistrust, and a lack of understanding of e-commerce and fintech by regulators. Fraud and low digital literacy further undermine the sector’s potential, hindering its ability to match the advancements seen in developed economies.

    In January 2017, the Central Bank of Nigeria (CBN) issued a circular declaring virtual currencies, including cryptocurrency, as non-legal tender in Nigeria. Banks and financial institutions were warned that any transactions involving cryptocurrency would be at their own risk. In February 2021, the CBN intensified its stance by directing all financial institutions to cease holding cryptocurrency or facilitating payments with it. The directive further instructed banks to identify and close accounts of customers engaged in cryptocurrency transactions. These stringent regulations have significantly impeded the growth of cryptocurrency in Nigeria.

    Despite these challenges, Nigeria’s fintech sector has continued to attract substantial funding. Between 2014 and 2019, the industry raised over $600 million. Notable successes include Kuda Technologies, a mobile-first bank in Nigeria, which secured $25 million in Series A funding led by Valar Ventures. Flutterwave, a payment platform, achieved unicorn status in 2021 after raising $170 million in Series C funding, valuing the company at over $1 billion. The funding, led by Avenir Growth Capital and Tiger Global, helped Flutterwave expand its global reach. Its partnership with PayPal now allows international customers to pay African merchants, bridging gaps in cross-border transactions. Regulated by the US Securities and Exchange Commission, Flutterwave is also exploring a listing on the New York Stock Exchange.

    In terms of consolidation, the Nigerian fintech space made history in October 2020 when Lagos-based payment platform Paystack was acquired by US payment giant Stripe in a landmark $200 million deal. This acquisition remains one of the largest in Africa’s fintech history, showcasing the sector’s potential despite regulatory hurdles.

    Why Gen Z, others age brackets are embracing fintech apps

    Currently, 17 companies in Nigeria are licensed by the Central Bank of Nigeria (CBN) as Mobile Money Operators, though the broader fintech sector boasts over 200 companies. These mobile money operators, often referred to as fintechs, have become a significant part of Nigeria’s financial landscape. For instance, All Adeyinka, a University of Lagos student, was able to complete a transaction at a vendor on campus simply by downloading the OPay app. After signing up and verifying his phone number, Adeyinka could choose the ‘verify account’ option, input any bank account number along with a random address, local government area, and state, and instantly create an account. “Using OPay has saved me a lot,” Adeyinka explained. “When my main bank app is down or experiencing interruptions, I just use the alternative, and it has helped me many times.”

    Similarly, Kemisola Akijyemi, a young entrepreneur, described fintech apps as ‘life savers,’ especially when other banking options are unavailable or unreliable. These platforms offer convenience, helping users navigate banking challenges with ease. “For me, since Moniepoint became a top choice for me and I also have the PoS, it has helped to ease my financial transactions. I prefer to stick with the other ones because everything goes smoothly in no time because this is business. Although I have my bank app for personal use, I have their time when things go south.”

    Mr. Hassan, a POS operator, shared that many Gen Z users now prefer conducting money transfers through fintech platforms rather than traditional banks, citing their convenience and ease of use. However, Mama Rukayat, a food vendor, expressed hesitation about fully embracing fintech services. Despite having accounts with several conventional banks, she remains cautious about moving entirely to fintech platforms due to concerns over falling victim to fraudsters.

    Financial expert Samuel Adewunmi pointed out that the erosion of trust in fintech companies has led some conservative bank users to remain loyal to traditional banks, valuing their perceived security and reliability. In an interview, the Managing Director of PalmPay, Chika Nwosu, acknowledged that one of the biggest challenges fintech companies face in Nigeria is building trust with the public, a critical factor for their long-term growth and success. “Many Nigerians remain sceptical of digital finance platforms, feeling wary about investing in services they cannot physically see or touch. This caution is amplified by memories of past Ponzi schemes that left people with significant financial losses, fostering a general distrust toward any online financial service.

    “To counter these concerns, we have taken comprehensive measures to earn and secure public trust. Firstly, we are fully licensed and regulated, and our funds are protected under the Nigeria Deposit Insurance Corporation, ensuring financial security for our clients. We also prioritise customer data protection, implementing strict privacy policies and robust cybersecurity measures to safeguard against fraud and criminal activity.”

    Recently, Moniepoint appointed Bayo Olujobi as the Chief Financial Officer (CFO) of its microfinance banking subsidiary, Moniepoint MFB. Olujobi, with nearly 20 years of financial expertise, joins Moniepoint from Stanbic IBTC Bank, where he held the positions of CFO and non-executive director. This appointment follows Moniepoint’s recent $110 million funding round, which will drive its aggressive expansion plans. Moniepoint aims to digitise operations for millions of small and medium-sized businesses across Africa, with a goal of onboarding 30 million businesses over the next five years. Tosin Eniolorunda, Group CEO of Moniepoint Inc., expressed confidence in the company’s customer proposition, highlighting its secure, convenient, and easy-to-use platform for managing both personal and business finances.

    In addition, Moniepoint is reportedly in discussions with the CBN to secure a commercial banking licence, which would give it a competitive edge over rivals like OPay and PalmPay. If successful, Moniepoint would become the first Nigerian fintech to hold a commercial banking license, a strategy similar to that of Nubank in Latin America, which applied for a banking license after becoming the primary bank for a significant portion of Brazil’s population.

    A commercial banking license would be a major milestone for Moniepoint, highlighting its growth and its commitment to adapting to Nigeria’s changing regulatory environment. Since the CBN increased scrutiny of fintech firms in December 2023, obtaining this licence would position Moniepoint as a stable, compliant, and forward-thinking player in the country’s rapidly evolving financial ecosystem. If granted, the commercial banking licence would provide Moniepoint with the ability to operate without the geographic and service limitations imposed by its current microfinance banking license. This would enable the fintech to expand beyond the South-West region of Nigeria and offer a broader range of banking services to businesses and individuals across the country.

    Fear and cybercrime

    Cybercrime remains a significant hurdle for the growth of Nigeria’s digital payment system, with an increase in fraud incidents largely attributed to relaxed transaction rules and inadequate customer verification standards. Phishing attacks, where scammers impersonate legitimate bank social media handles to steal customer information, have become widespread, compromising both banks and fintech companies. These vulnerabilities, coupled with insufficient identity management systems, make fintechs prime targets for cybercriminals.

    To counter these threats, fintech companies have invested heavily in robust security measures. For example, OPay has introduced the Large Transaction Shield, which uses facial recognition authentication to protect users from unauthorised transactions. This feature allows users to set personalized transaction limits, adding an extra layer of security for large or unusual transactions. Fintechs have also addressed the gaps left by traditional banks, particularly in the area of lending. While traditional banks often had stringent requirements, fintech companies have innovated by introducing online lending platforms that allow access to loans without the need to visit a physical bank. These platforms use alternative credit scoring methods, including Bank Verification Number (BVN)-linked phone numbers, to assess creditworthiness and repayment behavior.

    Meanwhile, MTN Nigeria’s MoMo Payment Service Bank (PSB) is further diversifying by applying for two new licenses, the Payment Service Solutions Provider (PSSP) and Payment Terminal Service Provider (PTSP). This strategic move could disrupt Nigeria’s digital finance landscape, enabling MoMo PSB to offer a wider array of financial services. These developments reflect how fintechs are evolving to meet the needs of a more digitally-savvy population while contending with cybercrime challenges.

    These new licences would allow MoMo PSB to handle payment terminals and manage backend processing for digital payments. This move opens up MoMo PSB to provide in-store and online transaction solutions for more merchants and customers.

    Regulations in fintech industry and CBN’s role

    Data from the Nigeria Inter-Bank Settlement Systems (NIBSS) has shown that licensed mobile money operators, including Palmpay, OPay, and 15 others, processed transactions worth N41.5 trillion between January and July 2024. This marks a significant 74% increase compared to the N23.9 trillion recorded during the same period in 2023. In 2023, mobile money operators collectively processed N46.6 trillion in transactions, the highest annual figure for mobile money in Nigeria’s history. This surge in mobile money activity mirrors the broader rise in e-payments in the country, with total transactions across all electronic channels reaching N566.3 trillion between January and July 2024.

    The fintech industry in Nigeria has seen significant regulatory advancements, with the CBN playing a key role in driving these changes. In January 2021, the CBN introduced a Framework for QR Code Payments, aimed at promoting contactless payments, particularly in the wake of the COVID-19 pandemic, which saw many physical cash systems shut down. This move was part of a broader initiative to enhance digital payment solutions across the country. That same year, the CBN launched the Framework for Regulatory Sandbox Operations to support fintech start-ups in navigating regulatory challenges while fostering innovation. The Securities and Exchange Commission (SEC) also took steps to formalize investment-based crowdfunding, publishing rules to regulate this space.

    Read Also: NSITF extends ESC to agency banks, fintech

    Further regulatory development occurred with the CBN’s introduction of the Open Banking Framework in February 2021, making it easier for fintech firms to access financial data and create more integrated financial services. In October 2021, the CBN unveiled the eNaira, Nigeria’s digital currency, which operates alongside the physical naira, expanding digital financial inclusion and offering a government-backed alternative to cryptocurrencies.

    Additionally, the Pan African Payments and Settlements System (PAPSS) was established with guidelines set by the CBN, facilitating cross-border payments across Africa. These regulatory initiatives are integral to shaping Nigeria’s rapidly growing fintech ecosystem and ensuring it develops in a secure and controlled environment.

    At the 2024 Nigeria Fintech Week, the theme “Positioning Africa’s Fintech Ecosystem to Accelerate Inclusive Growth” underscored the critical role fintech plays in driving socio-economic development across Africa. The event highlighted the continent’s growing fintech presence, offering innovative solutions that address its unique challenges, but also stressed the importance of reaching underserved populations who still lack access to traditional financial services.

    Emomotimi Agama, Director General of the Nigeria Securities and Exchange Commission (SEC), emphasised the need for “smart regulation” to manage the rapid growth of fintech. This approach balances innovation with essential protections for investors and market integrity. Agama advocated for flexible but rigorous regulatory frameworks that ensure fintech companies meet security, consumer protection, and market integrity standards. Aminu Maida, the Executive Vice Chairman of the Nigerian Communications Commission (NCC), also stressed the importance of strengthening regulatory frameworks for fintech. He praised Nigeria’s regulatory approach, noting that it has garnered global recognition, particularly within the International Telecommunication Union’s collaborative regulation benchmark, a testament to Nigeria’s growing influence in the fintech space.

    Point-of-Sale (PoS) systems have become a popular choice for many business owners, including traders and ride-hailing drivers, as their preferred tools for daily operations. Despite the availability of banking apps, many individuals in these sectors consistently lean toward fintech apps for easier transactions. The rise of PoS systems has undoubtedly made banking more accessible, especially in rural areas, and has significantly promoted financial inclusion. However, this adoption has also led to a surge in fraudulent activities, with scammers using PoS terminals to deceive unsuspecting Nigerians.

    According to data from the Nigeria Inter-Bank Settlement System (NIBSS), the number of registered PoS terminals in Nigeria reached 26.54 million within seven months, marking a 22.59% increase from the 21.65 million recorded in July 2023. This growth highlights the increasing shift toward digital payment platforms, driven by policies aiming to reduce the reliance on cash transactions. The number of newly registered PoS terminals in January 2024 alone reached 3.44 million, a 48.5% increase from January 2023.

    Despite the growing adoption of fintech solutions, digital banking services in Nigeria have faced erratic service delivery, with transactions that once took minutes now stretching into days. Additionally, many customers remain skeptical of fintech platforms, largely due to a lack of awareness and understanding. This ignorance, coupled with concerns about trust and security, leads many to continue relying on traditional banks for their transactions. Fintech companies still have a significant amount of work to do in terms of public sensitization and building trust within the Nigerian market.

  • Expanding financial inclusion footprints with bank recapitalisation

    Expanding financial inclusion footprints with bank recapitalisation

    The Central Bank of Nigeria (CBN) Governor Olayemi Cardoso reaffirmed that the ongoing bank recapitalisation will enhance Nigerians’ access to financial services. Speaking at the 2024 International Financial Inclusion Conference in Lagos, he emphasised the CBN’s commitment to surpassing financial inclusion targets for economic growth. The event, attended by key financial inclusion stakeholders, reinforced efforts to bring financial services closer to the people, reports Assistant Business Editor COLLINS NWEZE

    The second International Financial Inclusion Conference 2024 (IFIC’24), held last week in Lagos, provided a key platform for financial services stakeholders to highlight the benefits of financial inclusion. The event, themed “Inclusive Growth—Harnessing Financial Inclusion for Economic Development,” was organised by the Central Bank of Nigeria (CBN) in partnership with the Bankers Committee, World Bank, and the Financial Inclusion Steering Committee, among others.

    In his keynote speech, CBN Governor Olayemi Cardoso emphasised that the introduction of new minimum capital requirements for banks aligns with the apex bank’s commitment to deepening financial inclusion across the country. He said: “This strategic move ensures that banks are well-capitalised, enabling them to take on greater risks, particularly in underserved markets. With stronger capital bases, banks can provide more loans and financial products to Micro Small and Medium Enterprises (MSMEs), rural communities, and other vulnerable segments that have previously struggled to access formal financial services.

    “By enabling banks to extend more credit to MSMEs, we enhance job creation and productivity. Furthermore, with increased capital, banks can invest in technology and innovation, crucial for driving digital financial services such as mobile money and agent banking. These technologies are key to breaking down geographic and economic barriers, bringing financial services to even the most remote areas,” he stated.

    The event also presented opportunity for the CBN to launch the Women Financial inclusion Dashboard, Women Entrepreneurs Finance Code and Financial Inclusion of Forcibly Displaced Persons. These moves are expected to significantly reduce gender disparities in financial access. By providing improved opportunities for credit, savings, and insurance tailored for women, these initiatives are set to unlock their entrepreneurial potential, foster gender equality, and drive broader social development.

    The IFIC’24 expanded the role of youth as pivotal players in Nigeria’s economic future. Recognising that young people are critical to the sustainability and diversification of the economy, discussions centred on the essential nature of financial education programmes. By equipping younger generations with financial literacy, the conference triggered informed decision-making and promote long-term economic well-being, ultimately empowering them to participate actively within the financial ecosystem. Cardoso said financial inclusion has the potential to unlock significant economic growth, particularly through the empowerment of small and medium-sized enterprises (SMEs), women and other vulnerable segments of the population.

    “SMEs are responsible for over 80 per cent of employment in Nigeria, yet many struggle to access the credit needed for expansion. Financial inclusion for SMEs is essential to unlock the full potential of this sector, and the Nigerian government remains committed to supporting these enterprises,” he stated. The CBN had on March, 28, 2024 announced a two-year bank recapitalisation exercise which commenced on April 1, 2024, and is expected to end on March 31, 2026. The recapitalisation plan requires minimum capital of N500 billion, N200 billion, and N50 billion for Commercial Banks with International, National, and Regional licenses respectively.

    Reducing financial exclusion rate

    On his part, CBN Deputy Governor, Financial System Stability, Philip Ikeazor disclosed that since the launch of the strategy, which is currently in its third iteration, the CBN and stakeholders have worked tirelessly to reduce financial exclusion rates. Owing to these efforts, the exclusion rate has dropped from 46.3 per cent in 2010 to 26 per cent as of 2023. He said: “Despite this progress, there are over 28 million Nigerians who still have no access to formal financial products and services and certain challenges persist, particularly in ensuring financial access for five most excluded demographics: women, youth, rural communities, Northern Nigeria and Micro, Small and Medium Enterprises (MSMEs).”

    He said that financial inclusion is the cornerstone of any robust economic development strategy. By ensuring that all citizens, especially those in underserved regions, have access to essential financial services, we unlock the potential for sustainable and inclusive growth. “For Nigeria, financial inclusion has been a collaborative journey involving the Central Bank of Nigeria and its partners, many of whom are represented here today. This collaboration was spurred by Nigeria’s commitment at the Alliance for Financial Inclusion’s 3rd Global Policy Forum in Riviera Maya, Mexico, where over 80 institutions from 76 countries committed to enhancing financial access through the ‘Maya Declaration.’ Following Nigeria’s commitment to the declaration, the Central Bank of Nigeria alongside key stakeholders launched the National Financial Inclusion Strategy in 2012 to serve as a roadmap towards reducing the country’s adult financial exclusion rate,” he said.

    Ikeazor said the CBN has rolled out targeted programmes and initiatives, including financial inclusion drives, financial and digital literacy awareness, sensitization campaigns, and the release of Frameworks and Guidelines targeted at accelerating financial inclusion and guiding players in the space. He said Nigeria’s financial inclusion journey cannot be discussed without recognising the rise in the usage of Digital Financial Services (DFS) which has led to a sustained increase in the use of mobile banking and agent banking networks, partnerships between Financial Technology Companies (FinTechs) and telecommunications companies all of which have played a crucial role in improving access to financial services in remote areas. These efforts have reduced the geographical and infrastructural barriers that once excluded millions from financial participation. Today, millions of Nigerians can send and receive payments, save, and access credit via digital platforms, which are transforming the financial landscape.

    “As we look ahead, it is clear that achieving 95% financial inclusion in Nigeria requires concerted efforts from all stakeholders—government agencies, financial institutions, Financial Technology companies, development organizations, and civil society. The Central Bank of Nigeria is committed to fostering these collaborations to ensure that financial inclusion initiatives are effectively implemented across the country. Today’s Conference offers an invaluable opportunity to share insights, challenge assumptions, and explore new strategies that will bring us closer to achieving our shared goal of inclusive economic growth,” he said.

    Read Also: Nigeria’s financial inclusion grows to 50%

    Also speaking, Lagos State Governor, Babajide Sanwo-Olu, reiterated the benefits of financial inclusion to businesses and economy. The Governor, who was represented by the Deputy Governor, Femi Hamzat, said that financial inclusion is at the centre of economic development. He said Nigeria has what it takes to deepen financial inclusion, and support the growth of business and economy. He said that financial inclusion will also support government’s efforts to achieve $1 trillion economy.

    He further highlighted the gains of human-centred, technology-driven solutions to broaden financial inclusion across the state. His remarks underscored that financial inclusion transcends mere access—it is fundamentally about empowering individuals to thrive both economically and socially. Also, in support of President Bola Ahmed Tinubu’s vision of restructuring Nigeria’s economy to reach the ambitious goal of achieving a $1 trillion economy, stakeholders were encouraged to prioritise policies that support financial inclusion initiatives.

    Analysts said the policies should combine technology and innovative solutions while ensuring that financial services are accessible, equitable, and effective for all citizens, reinforcing the country’s position as a burgeoning financial hub in Africa. Also speaking, Managing Director, Nigeria Deposit Insurance Corporation (NDIC), Bello Hassan, said Nigeria financial services regulators want to achieve financial inclusion target they set for themselves because of the immense benefits it will bring to the economy.

    According to him, the NDIC raised the minimum insured deposits to ensure that more Nigerians develop interest in the financial system and also to protect depositors. He said that NDIC is committed to ensuring that customers’ deposits are secured to ensure greater inclusion in the financial system.

    Continuing, Cardoso said that women also play a critical role in driving inclusive growth. Research shows that when women are financially empowered, they reinvest in their families and communities, creating broader socio-economic benefits. “Yet, women in Nigeria are disproportionately excluded from the formal financial system. The Central Bank of Nigeria has made significant strides in promoting financial inclusion for Women and youth, particularly through Frameworks aimed at closing gender gaps and regulatory support for digital platforms that offer easier access to financial services for these vulnerable groups. With programs aimed at financial literacy, the CBN is also empowering young Nigerians to become financially independent, fostering entrepreneurship, and driving economic growth across the country,” he said.

    One of the most transformative tools for financial inclusion has been the adoption of digital payment channels leveraging mobile technology. He said Nigeria’s growing mobile phone penetration provides an unprecedented opportunity to expand access to financial services. Interoperable payment platforms have enabled millions of Nigerians to send payments, save, and access credit without traditional bank accounts. “Technological advances have democratized financial services, allowing people in remote areas to participate in the economy and this government is committed to creating an enabling environment for these innovations to thrive, through policies that foster competition, innovation, and financial stability,” he said.

    He said that since the launch of the National Financial Inclusion Strategy (NFIS) in 2012, the CBN in collaboration with partner agencies has championed policies and initiatives to reduce financial exclusion. These initiatives have been guided by the vision of ensuring every Nigerian has access to affordable financial services, from basic savings accounts to micro pension and micro insurance offered by other regulated non- bank financial institutions to digital payment platforms.

    Tackling financial inclusion hitches

    The IFIC’24 acknowledged the challenges in the financial inclusion journey, including issues around infrastructure, including inconsistent electricity supply and limited internet connectivity which continue to hinder widespread adoption of digital financial solutions. The ongoing need for investment in critical infrastructure is paramount for scaling up digital finance initiatives. For instance, a 2023 survey revealed that 40 per cent of financial transactions in Nigeria remained unresolved, leading to a concerning erosion of trust in digital financial systems.

    To mitigate these issues, enhancing data security, streamlining payment systems, and implementing robust regulatory frameworks were identified as essential steps for rebuilding confidence among users. The IFIC’24 further highlighted the importance of promoting financial literacy to empower individuals in their financial decision-making. Targeted education programs are necessary to fill knowledge gaps and address misconceptions about financial services, thereby helping to foster a more informed consumer base.

    Cardoso said: “In Nigeria, the 2023 EFInA Access to Finance survey reveals that 26 per cent of the adult population remains financially excluded. This statistic highlights a critical challenge: almost one-third of Nigerians cannot access capital to grow businesses, secure savings for the future, or obtain insurance to mitigate risks. The absence of these services traps individuals in cycles of poverty and stunts national economic expansion. Widespread access to financial services is an enabler of economic activity.”

    He reiterated CBN’s commitment on ensuring its financial inclusion policies and initiatives address the peculiar access to finance barriers for underserved populations, particularly Women, Youth, and MSMEs. “The importance of this mission cannot be overstated, as I have reiterated that financial inclusion is foundational to Nigeria’s sustainable economic development. In line with its efforts to deepen financial inclusion, the CBN recently introduced new minimum capital requirements for banks. This strategic move ensures that banks are well-capitalised, enabling them to take on greater risks, particularly in underserved markets,” he said.

  • How to leverage advanced analytics to enhance financial inclusion

    How to leverage advanced analytics to enhance financial inclusion

    Olawunmi Gbolade is a seasoned programme manager and consultant based in Rockville, Maryland with focus on using advanced analytics to promote financial inclusion, particularly in marginalised communities across the United States. She speaks with OLUKOREDE YISHAU on this crucial topic. Excerpts:

    Let’s start with the big picture. Financial inclusion remains a significant issue in the U.S., with many communities still lacking access to essential services. How widespread is this problem, and why does it persist?

    Financial inclusion, or the lack thereof, is indeed a pressing challenge in the U.S. According to the Federal Deposit Insurance Corporation (FDIC), as of 2021, about 5.4% of U.S. households—around 7.1 million—were unbanked. This means they don’t have access to basic banking services. Additionally, 13% of households are underbanked, relying on alternative services like payday loans or check cashing. These statistics highlight significant barriers, especially for low-income households, racial minorities, and rural populations. The issue persists due to a combination of factors, including systemic inequalities, a lack of trust in financial institutions, and inadequate access to affordable financial services.

    With these challenges in mind, how can advanced analytics, particularly predictive models, make a difference?

    Advanced analytics, especially predictive models, offer powerful tools to bridge the gap in financial inclusion. These models use historical data, machine learning, and statistical algorithms to predict future behaviors and outcomes. In the financial sector, this can be transformative. For example, traditional credit scoring models, like FICO, often exclude marginalized populations because they rely on formal credit histories. However, predictive analytics can incorporate alternative data sources—like rent payments, utility bills, and even mobile phone usage—to assess creditworthiness. This more inclusive approach allows financial institutions to extend credit to those previously overlooked.

    A good example is Petal, a U.S.-based fintech company that uses machine learning to analyze customers’ cash flow and spending habits, rather than just their credit scores. This approach has opened up credit to people with limited or no credit history, such as younger adults and immigrants.

    That’s fascinating. Could you elaborate on how predictive analytics can be used beyond credit scoring, particularly in designing other financial products?

    Absolutely. Predictive analytics can play a significant role in designing a variety of financial products that cater to the unique needs of different communities. For instance, savings products can be tailored based on behavioral data. Financial institutions can analyze how various demographic groups approach saving and create products that encourage sustainable savings habits.

    An example could be a savings account that automatically rounds up transactions and deposits the difference into a savings account. This type of product, informed by predictive data, can help low-income households save incrementally without much effort.

    It sounds like predictive analytics is not just about inclusion, but also about empowerment. How is this approach being applied by government agencies?

    That’s correct. Empowerment is key. Government agencies are increasingly using advanced analytics to evaluate and improve their financial inclusion programs. One example is the U.S. Department of the Treasury’s Community Development Financial Institutions (CDFI) Fund. They use data to identify regions where financial inclusion efforts are most needed and ensure that federal resources are allocated effectively. By analyzing data on income levels, credit access, and financial behaviors, the Treasury can better target communities that would benefit most from support.

    Another interesting initiative is the U.S. Postal Service’s exploration of offering financial services. Using demographic data, the USPS can pinpoint neighborhoods where traditional banking services are scarce and consider piloting postal banking programs in those areas. This data-driven approach ensures that resources are deployed where they can have the greatest impact.

    It’s impressive to see how data can guide these decisions. What about evaluating the success of existing programs? How do analytics come into play there?

    Advanced analytics are crucial for evaluating program effectiveness. Agencies like the Consumer Financial Protection Bureau (CFPB) use data to track the success of financial literacy and inclusion programs. By analyzing participants’ financial behaviors over time, they can assess which aspects of the programs are working and where adjustments are needed.

    For example, if a financial literacy program isn’t leading to improved financial decision-making in low-income households, data can reveal why. Maybe the content needs to be more relevant or accessible, or perhaps the delivery method isn’t resonating with the target audience. With real-time data, adjustments can be made quickly, making these programs more effective.

    Real-time data seems to be a game changer. Can you share an example where this kind of dynamic adjustment was particularly impactful?

    Certainly. A recent example is how the U.S. government distributed stimulus payments during the COVID-19 pandemic. Using advanced analytics, they were able to assess economic impacts in real-time and identify populations most in need of support. This allowed for targeted distribution of stimulus payments and unemployment benefits, ensuring that relief efforts reached the most vulnerable groups.

    This ability to adjust strategies dynamically, based on real-time data, is one of the biggest advantages of advanced analytics, especially during crises when quick and targeted interventions are essential.

    As promising as this all sounds, there are always challenges. What are some of the hurdles you see in implementing advanced analytics in financial inclusion, and how can they be addressed?

    One of the main challenges is data privacy and security. With increased reliance on data, it’s essential to protect individuals’ personal information. Robust data governance frameworks and transparency in how data is collected and used are critical.

    Another challenge is the potential for bias in predictive models. If these models aren’t carefully designed, they can inadvertently perpetuate existing inequalities. For example, over-reliance on certain data points could exclude specific groups. To mitigate this risk, it’s important to use diverse data sources and continuously monitor the models for bias.

    Addressing these challenges requires a commitment to ethical use of data and ongoing scrutiny of how these models are applied.

    That’s an important point. As we look to the future, what do you see as the next steps in leveraging advanced analytics for financial inclusion?

    The future lies in continuing to innovate while ensuring ethical practices. We need to keep harnessing data to design more inclusive products and optimize government programs. But we must also prioritize transparency, fairness, and security in how these tools are used.

    If we do this right, we can break down barriers to financial inclusion and create a system that works for everyone. This not only benefits individuals and communities but also contributes to broader economic growth and resilience.

    Thank you, Olawunmi, for sharing your insights. It’s clear that advanced analytics has the potential to transform financial inclusion in meaningful ways. We appreciate your time and expertise.

    Thank you. It was a pleasure to discuss this important topic.

  • New report shows wide disparity in financial inclusion

    New report shows wide disparity in financial inclusion

    The 2023 EFInA Access to Finance (A2F) Survey results launched in Lagos shows that the North has the least access to financial services.

    The report disclosed that exclusion from financial services  continues to be most severe in Northern Nigeria, at 38 per cent in the Northeast and 47 per cent in the Northwest compared to only five per cent  in the Southwest and 10 per cent in the Southsouth.

    The A2F survey is Nigeria’s primary source of financial inclusion data and is designed to assess access to and use of financial services for the adult (Nigerian) population. The methodology for the survey has been updated to reflect changing population dynamics, and 2018 and 2020 data also updated using the same methodology to enable comparison.

    The results show that 26 per cent of Nigerians are financially excluded, down from 32 per cent in 2020, demonstrating progress towards the Nigeria Financial Inclusion Strategy (NFIS 3.0) recommended target to reduce levels of financial exclusion in Nigeria to 25 per cent by 2024.

    The report said  usage of broader financial services remains limited demonstrating the urgent need to focus on the quality and impact of inclusion. While credit use doubled to is six per cent, pension and insurance use remained at eight per cent and three per cent respectively, well below 2024 target levels.

    It said though formal inclusion is growing, from 56 per cent in 2020 to 64 per cent in 2023, those accessing formal financial services through banks increased much more slowly, from 51 per cent to 52 per cent.

    It said growth in formal inclusion was being driven by the increased use of non-banking channels, which grew from five per cent in 2020 to 12 per cent in 2023.

    Read Also: Kano: No deal with NNPP to compromise Supreme Court judgement, APC dispel rumour

    Despite growth in access, certain demographic gaps continue to persist in Nigeria. There was growth in women’s financial inclusion from 60 per cent in 2020 to 70 per cent in 2023 despite an increase in the gender gap from eight per cent recorded in 2020 to nine per cent in 2023.

    However, with formal financial inclusion levels at only 64 per cent (up from 56 per cent in 2020), there remains significant work to do to achieve the ambition of the Central Bank of Nigeria (CBN)’s 95 per cent formal inclusion in the long term.

    EFiNA Chair Dr Agnes Martins said: “We are seeing encouraging progress towards the NFIS 3.0 recommended goal to reduce exclusion to 25 per cent by 2024, and we must acknowledge all the good work that has gone into making this happen. However, we also have to be clear that 26 per cent exclusion means that 28.8 million adult Nigerians continue to be completely excluded from the financial system.

    “That is a statistic that we must recognise remains unacceptable, and we must redouble our efforts to accelerate their inclusion. These are predominantly farmers and dependents, more likely to be female, and to live in rural areas in Northern Nigeria. We need intentional, deliberate strategies to give them financial access and to support them graduate to the products and services that can enhance their resilience. Over the coming weeks we will be engaging all stakeholders to further analyse the data and work collaboratively to develop solutions.”

     CBN Governor Yemi Cardoso said Nigeria’s drive for financial inclusion has been a long, sometimes arduous journey.

    “We have monitored the trend over the years and have sometimes worried about the slow pace of progress in achieving an inclusive economy. The results being shared today, however, indicate that with sustained dedication and commitment, we can truly achieve our collective goal of financial inclusion for all,” he said.

    Cardoso, who was represented by, CBN Director,  Other Financial Institutions Supervision Department, Chibuike Nwagerue,  lauded   financial inclusion stakeholders for the efforts made and the progress achieved.

    “However, to achieve the target of 95 percent financial inclusion, we must all move from collaboration to concrete commitment. To that effect, I call on Financial Inclusion implementation agencies to set up specific functions or units dedicated to financial inclusion in their various organisations. This we believe, will provide the necessary ownership and commitment required to achieve our collective goal,” he said.

  • Creating meaningful financial inclusion in Nigeria

    Creating meaningful financial inclusion in Nigeria

    • By Tosin Eniolorunda

    There is one undeniable truth, that even the most ardent of skeptics might actually hold to be true – Nigeria, as Africa’s most populous nation, has the potential to become the greatest country on the continent. From its vast arable land to an enormous population which has a high propensity to be an asset if adequately managed and deployed, it’s really ours for the taking. The role of financial inclusion as a catalyst for economic development, poverty reduction, and social inclusion has been widely recognized. Some industry analysts aver that if we are going to be able to deepen shared prosperity, accelerate poverty reduction and reduce inequality, then we have got to roll up our sleeves and invest in critical physical, financial, digital, technological and innovation infrastructure that support the building of our most valuable asset – Nigeria’s human capital. Because at the end of the day, financial inclusion, financial literacy is about the transformative power that people have whether they live in bustling cities or remote villages. The question to be asked is how do we create a meaningful experience for all stakeholders.

    Identified barriers that prevent meaningful outcomes include low income, low financial literacy, lack of trust in financial institutions, high cost of financial services, inadequate infrastructure, and restrictive regulations. Sadly, these challenges disproportionately affect women, rural dwellers, youth, and micro, small and medium enterprises. However, as both empirical and anecdotal evidences have shown in many emerging markets, the effective deployment of technology in leapfrogging over previously identified barriers holds the biggest attraction. It’s usually a game changer. India and China, with similar heterogenous societies and large populations are fine examples to learn from.

    Imagine the immense satisfaction that will come from POS terminals being able to cater to the tactile or auditory needs of the physically challenged – this is inclusiveness in all its trappings. Can we use technology to deliver financial literacy modules or microsite where people can access and understand using pidgin and local languages?

    Can we have contactless payment solutions become the default mode of payment in a way that means that the bus conductor isn’t asking a passenger for cash, all that needs to happen will be done via a mobile phone from Damaturu in Yobe to Agenebode, Edo State? Surely, an aggressive adoption of innovative technologies will make a huge difference in our lives irrespective of gender, creed, station in life and other societal markets.   

    Another tool for unlocking prosperity will be how we leverage digital financial services (DFS), which are enabled by information and communication technologies (ICTs), such as mobile phones, internet platforms, and electronic payment systems. DFS have demonstrated that costs can be lowered while increasing the convenience, and expanding the reach of financial services to the underserved segments of the population. As we have seen with players like Moniepoint, they are fostering innovation and competition in the financial sector, creating new opportunities for value creation and economic diversification. Imagine a scenario where we can reverse engineer our financial landscape such that DFS become the dominant go-to service provider for accessing credit, savings, insurance, pensions, and other financial products and services that could improve their livelihoods and resilience.

    Read Also: Moniepoint promises to drive financial inclusion in Nigeria

    Lastly, the role of transformational leadership at all levels of government #and the private sector should be of the highest national significance in curating a meaningful experience for all stakeholders across our financial services system. As we all know, creating a supportive regulatory and policy environment is necessary to foster financial inclusion. Clear and inclusive regulations that promote competition, innovation, consumer protection, and data privacy will be instrumental. Collaboration and partnerships among various stakeholders is closely aligned to the point. This is because even by our communal Ubuntu ethos as Africans, we recognize that no single tree can beautify a forest, it will take the coming together of many trees to provide shade and succor for many people. 

    Creating a meaningful experience for all stakeholders in financial inclusion in Nigeria is not just about increasing the number of bank accounts. It’s about empowering the unbanked, supporting financial institutions, and fostering a collaborative effort among government agencies and fintech companies. Only through a holistic approach that takes into account the unique challenges and aspirations of each stakeholder can Nigeria truly achieve the goal of financial inclusion, ensuring a brighter and more financially secure future for all its citizens.

    In unlocking prosperity for all Nigerians, it is imperative to harness the power of technology and digital financial services. This would require concerted efforts from various stakeholders, including the government, regulators, financial institutions, fintech firms, civil society organizations, and consumers. By creating a conducive environment for innovation and inclusion in the digital financial space, Nigeria can realize its vision of becoming a leading African economy in the 21st century.

    • Eniolorunda is Group CEO, Moniepoint Inc.
  • Report: Women, poor households dominate financial exclusion list

    Report: Women, poor households dominate financial exclusion list

    World Bank report has listed women and poor households in rural areas or out of the workforce as the major groups that dominate the financial exclusion. The trend can be reversed by stakeholders providing transaction accounts to more women and poor households. This is because  accessing financial services is a first step towards broader financial inclusion centred around sending and receiving payments, writes Assistant Business Editor, COLLINS NWEZE.

    Financial inclusion is a strong lever for bridging income inequality, combating poverty and preserving social harmony. 

    It is an individual’s ability to access and transact businesses through the financial system using technology or other methods provided by the financial institution.

    The World Bank, central banks and commercial banks across many counties and regions have made strong case on ways to bring financial services closer to the grassroots.

    The Central Bank of Nigeria (CBN) has accordingly been at the forefront of the efforts to drive financial inclusion in Nigeria by championing the development and implementation of Nigeria’s National Financial Inclusion Strategy. 

    A transaction account, which is at the centre of financial inclusion expansion plan,  serves as a gateway to other financial services, which is why ensuring that people worldwide can have access to a transaction account is the focus of the World Bank Group’s Universal Financial Access Initiative.

    According to the World Bank report, financial access facilitates day-to-day living, and helps families and businesses plan for everything from long-term goals to unexpected emergencies. 

    The World Bank explained that as accountholders, people are more likely to use other financial services, such as credit and insurance, to start and expand businesses, invest in education or health, manage risk, and weather financial shocks, which can improve the overall quality of their lives.

    “Great strides have been made toward financial inclusion and 1.2 billion adults worldwide have gotten access to an account since 2011. Today, 69 per cent of adults have an account,” the bank said.

    In Nigeria, Central Bank of Nigeria (CBN)  said Nigeria will attain 95 per cent financial inclusion by 2024.

    Moving from access to account to account usage is the next step for countries where 80 per cent or more of the population have accounts. These countries relied on reforms, private sector innovation, and a push to open low-cost accounts, including mobile and digitally-enabled payments.

    The gender gap in account ownership remains stuck at nine percentage points in developing countries, hindering women from being able to effectively control their financial lives. 

    The bank said that since 2010, more than 55 countries have made commitments to financial inclusion, and more than 60 have either launched or are developing a national strategy. When countries take a strategic approach and develop national financial inclusion strategies which bring together financial regulators, telecommunications, competition and education ministries, our research indicates that when countries institute a national financial inclusion strategy, they increase the pace and impact of reforms.

  • New digital bank to drive financial inclusion

    New digital bank to drive financial inclusion

    • Kayi App to boost access to funds

    Minister of Communications, Innovation and Digital Economy, Dr Bosun Tijani yesterday inaugurated Kayi Bank and App, an online payment platform, as part of efforts to drive financial inclusion and access to funds by the unbanked segments of the country.

    Kayi Bank and App is an innovative fintech payment platform founded by a Kano based businessman,  Alhaji Saadina Dantata with investors from across Nigeria, United Arab Emirates (UAE), Saudi Arabia and Turkey among others.

    The product launch at Transcorp Hotel,  Abuja, attracted several dignitaries including Chairman, Azman Group, Alhaji Abdulmunat Sarina,  Otunba Toye Ariyo and Alhaji Mohammed Sani Abacha and Director General, National Information Technology Development Agency, NITDA, Kashifu Abdullahi.

    Dantata said Kayi App is a pioneering fintech solution committed to security, speed, and customer satisfaction.

    “We empower individuals and businesses across Africa, offering seamless transactions in traditional and cryptocurrency. Our mission includes serving the unbanked, the diaspora community, and urban professionals.

    Read Also: Minister inaugurates Kayi Bank/App to drive financial inclusion

    “It is powered by Web3 technology, and we ensure stability and speed, targeted at changing the narratives of technology driven payments platforms in Africa and across the world.

    “We are excited to introduce our innovative fintech product, Kayi App, to the Nigerian market. With our dedicated and young team of innovative and creative Nigerians drawn from across the world, we have worked tirelessly to develop a suite of fintech solutions that will make financial transactions simpler, faster, secure and more convenient for everyone,”  Dantata said.

    While inaugurating the new product, Tijani expressed delight that it would add some impetus to the commitment of the administration of President Bola Tinubu to promote financial inclusion,  create jobs and wealth through technology Innovations.

    He described Nigerians as extremely endowed with entrepreneurship spirits,  stressing that the launch of Kayi Bank and the payment platforms would grant access to credits for farmers, health and education sectors entrepreneurs and those in the transport businesses.

    He said that financial inclusion contributes significantly to economic growth by increasing the number of individuals and businesses that can participate in the formal economy.

    Tijani said: “As we all know, Nigerians are extremely entrepreneurial and while they are entrepreneurial, there is also a significant amount of entrepreneurs that are not included in the formal economy.

    “If these entrepreneurs are not included in the formal economy, we will struggle to actually be able to drive strong and inclusive economic growth to true financial inclusion.

    “We can bring more people into the economy. And by bringing more people into our economy, we stand the chance to reduce poverty.”

    The minister said that entrepreneurship can be fostered by having a strong financial inclusion in the society.

    He added: “When we have a strong financial inclusion in society, you can also foster entrepreneurship and there is no other way we can grow without entrepreneurship.”

    Tijani said that the agric sector contributes significantly to Nigeria’s Gross Domestic Product (GDP), adding that good financial inclusion will ensure farmers have access to resources they need as inputs.

    The minister said: “They can manage income better, they can manage their sales better, but they also can access credits that can help them to do what they need to do.”

    He urged investors to invest more as there was a lot of money to make from the bottom of the pyramid.

    Earlier, the Managing Director of the bank, Yunusa Mohammad, said it would explore core features and capabilities to reshape financial transactions, broaden accessibility and empower users to take charge of their financial destinies.

    “We will explore the core features and capabilities of the Kayi app, illuminating how this mobile application will reshape financial transactions, broaden accessibility and empower users to take charge of their financial destinies.

    “We are also unveiling the future where financial transactions are simplified, more accessible and empowering for all,” Yunusa said.

    In his goodwill message, Inuwa said the initiative would help institutionalise investment in Nigeria’s startups.

    “This will really help us and institutionalise investment in startups in Nigeria. Kayi is about job creation. It is about enpowering our people to build the next digital bank,” Inuwa said.

    Speaking on opportunities in the market, Kayi Bank Product Lead, Abdulganiyu Rufa’i said the African fintech market is brimming with opportunities and that Kayi App is poised to make a significant impact.

    “With vast majority of Africans unbanked and underbanked, we are confident in our ability to meet the growing demand for digital financial services across Africa.

    “Having recognised unmet needs in the country’s payment digital industry, therefore, Kayi App is poised to showcase strength in delivering core services and solutions such as instant digital payments for individuals and businesses; financial inclusion and social banking for people in rural and semi-urban areas; blockchain-backed cross- border trade for exporters and importers across Africa; and remittances and investments for Nigerians and Africans in Diaspora,” Rufa’i said.

  • Nigeria 25% below digital financial inclusion target

    Nigeria 25% below digital financial inclusion target

    • 160 million Nigerians on net

    Nigeria has attained 70 per cent digital financial inclusion, barely five months to the end of the period set for 95 per cent financial inclusion.

    The Central Bank of Nigeria (CBN), and leading a multi-sectoral stakeholders, had January 2024 as its set target.

    Executive Vice Chairman (EVC), Nigerian Communications Commission (NCC), Prof. Umar Danbatta, said digital financial inclusion peaked at 70 per cent by May, this year.

    Also, internet penetration rose to 160 million citizens from 159 million citizens previously recorded.

    Danbatta attributed the development to digital finance strategy adopted by the government and investments in telecoms infrastructure.

    Danbatta further said the rise in the country’s digital financial inclusion index followed the issuance of banking licences to four network operators by the CBN few years ago when the penetration was just one percent.

    Read Also: What Cardoso should do as CBN helmsman, by experts

    According to him, the digital financial inclusion strategy of government is leveraging the telecoms infrastructure to drive the financial inclusion plan, because of the pervasive nature of the telecoms infrastructure.

    ‘‘Before the mobile money penetration was one per cent and the CBN gave payment service bank licences to four network operators and the digital financial inclusion index in the country has risen to 70 per cent,

    ‘‘We have a number of initiatives driving innovation, and we provide interventions to enable Nigerians innovate,’’ Danbatta said.

    On the security of the cyberspace, the EVC said, the Nigerian Computer Emergency Response Team domiciled in the office of the National Security Adviser (NSA) was established to protect the cyber space, in addition to the Nigerian Computer Incidence Response Team which provides advisory on daily basis on how telecommunications companies can take measures to protect themselves from malicious attacks from the cyber space. 

    He expressed delight on the progress so far  made on internet penetration in the country, stressing that it has become imperative for all stakeholders to prioritise infrastructure, inclusion and access, especially to those in the rural areas.

    He however, called on various stakeholders to raise the bar in the areas of inclusion, security of cyberspace and innovation, especially now that service data is driving the banking sector.

    Danbatta spoke at the 11th edition of the Digital Africa Conference and Exhibition in Abuja.

    Chairperson, AFIGF,  Lilian Nlawoga of Uganda said we  need to power actual users of new technology  beyond localising the technology, infrastructure provision, policy making.

    She also stressed the need to build trust and innovate with local solutions