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Tag: touching lives

  • Touching lives with sustainable banking

    World Bank data indicates that global poverty rate is declining. But in sub-Saharan Africa, the number of those living in extreme poverty keeps rising. The Nigerian Sustainability Business Principles (NSBP), which was established to reverse the trend and bring better life to Africans, has brought stakeholders in the financial sector together to enhance economic growth and promote common good through sustainable banking practices, writes COLLINS NWEZE.

    The World Bank poverty index is not looking good for sub-Saharan Africa. While the global rate of poverty is declining, its rate in sub-Saharan Africa is rising.

    But to reduce poverty rate in the region requires collective action from financial institutions and implementation of sustainable banking principles that promote financial inclusion and  Corporate Social Responsibility (CSR).

    For instance, two years ago, about 28 per cent of the African population was found to be severely food insecured, rising about three per cent from 2014.

    The continent is also found to have the highest prevalence of undernourishment, which is about 20 per cent. Aside poverty as a primary factor, others such as conflict, lack of investment in agriculture and environmental challenges, have been said to be responsible for this. Those living in poverty cannot often afford food of sufficient quality or quantity to live a healthy life.

    In 2018, the World Bank reported that extreme poverty has rapidly declined globally, with estimates showing that the number of extremely poor people- those who live on $1.90 a day or less—has fallen from 1.9 billion in 1990 to about 736 million in 2015. However, the number of people living in extreme poverty keeps increasing in the sub-Saharan Africa, actually peaking in 2018 with 437 million people, and then slowly will decline again to reach 416 million in 2030.

    This year, most Nigerians were disturbed by the World Bank data referring to the most populous black country on the planet as the ‘poverty capital of the world’, with 86.9 million Nigerians still living in extreme poverty.

    The country is faced with numerous challenges, most of which are captured in the Sustainable Development Goals (SDGs) –  poverty eradication, hunger and food security, adequate provision of good health, education, advancing gender equality and women empowerment, developing infrastructure, provision of water and sanitation, provision of clean and affordable energy and taking effective action on climate change.

    In order to address these, a leading financial institution, Access Bank, facilitated the birth of the Nigerian Sustainability Business Principles (NSBP), by bringing together stakeholders in the financial sector with the aim of securing buy-in for the development of the nine principles. They include environment and social risk management, environment and social footprints, human rights, women’s economic empowerment and  financial inclusion.

    They also include environment and social governance, capacity building, collaborative partnerships and reporting. These principles are today being adopted by all banks in Nigeria, including the Central Bank of Nigeria (CBN). This year (2018), marks the fifth anniversary of the implementation of the NSBP in the Nigerian financial sector.

    Since 2008, the bank has successfully built a sustainability strategy driven by sustainable financial services – developing innovative services that enhance the lives of customers and enables them reduce environmental and social impacts, building sustainable economies – facilitating and financing sustainable economic growth through financial inclusion and education, sustainable societies – supporting vibrant and successful communities in every market, environmental responsibility – having a competitively low environmental impact for a bank in its markets, and best in class operations – providing best in class expertise, tools and capabilities to helping drive down costs and increase value.

    Specifically, Access Bank recognises the importance of climate action, supporting people, businesses and communities in building sustainable enterprises, all of which led to several awards both locally and internationally. Recently, it also received top honours at the 2018 Karlsruhe Sustainable Finance Awards in Germany, emerging as the winner in two categories and the Euromoney Awards for Excellence as ‘Africa’s Best Bank for Corporate Social Responsibility’ in London in July.

    During the bank’s Sustainability Awareness Week, a week-long activity to celebrate its remarkable achievements since 2008, Access Bank Group Managing Director/Chief Executive Officer, Herbert Wigwe, expressed the bank’s determination to create meaningful impact around the world and its subsidiaries by increasing awareness of best sustainable practices that can be implemented within its operational areas.

    He also listed profit, planet, and people as the pillars on which corporate sustainability are entrenched, stating that “this comes with a vision to be the most sustainable and respected bank in Africa, financing and facilitating brighter futures for all of our stakeholders through innovative services and best in class operations”.

    Banking thrives in an environment where lenders promote activities that make life better for the people. Indeed, banking should strive to meet the triple bottom line: People, Planet, and Profit. Beyond the profit motive, banks should ensure that the people and the environment where the business is done have something to cheer.

    Banking is not all about profitability. It should be done with human face and recognition that the communities where the business is conducted should benefit from the profit that comes from it. The CBN, the Nigeria Deposit Insurance Corporation and Deposit Money Banks (DMBs) agreed that banking can only thrive in an environment where CSR and commitment to the communities where the business is done, are given a priority. The CBN has, therefore, encouraged the adoption of sustainable banking practice by banks, given that environmental and social responsibility support business success and long-term growth.

     

    SERAs validates Access Bank’s efforts

    Sustainability, Enterprise and Responsibility Awards, also known as SERAs CSR, has helped to highlight various factors for improvement and national development, especially in working with different organisations to eradicate poverty and engender transformative change, which guarantees a safe, equitable and sustainable world for both the current and future generations.

    The SERAs award is an annual project, which aims to promote as well as raise awareness about the roles organisations play with an emphasis on their responsibility towards stakeholders and the social development of Africa. The SERAs, aims to substantiate the case that corporations who are socially responsible stand to gain huge benefits in regards to the triple bottom line – economic, social and environmental capital.

    The 12th edition of the award was held on Saturday, December 1, 2018 in Lagos. The event attracted several dignitaries and executives from diverse sectors. There were 22 categories open for contention, four of them were won by Access Bank, including the Best Company in Partnership for Development, Best Corporate Communication Team, Sustainability Practitioner of the Year – received by Omobolanle Victor-Laniyan, Group Head of Sustainability Access Bank and the Most Responsible Business in Africa, both of which were the biggest awards of the night and for Access Bank, a back-to-back success.

    For Access Bank Plc, banking also includes empowering the people and giving their lives a positive meaning. That explains why it has continued to take steps that promote the common good. For instance, the Operations Unit of Access Bank Plc. recently handed over two blocks of classrooms it renovated to the Keke Nursery and Primary School, Agege, Lagos. The Bank did not only strengthen the dilapidated buildings and fortified them with iron formations, it also changed the roofs, windows and painted the classrooms to give them new looks.

    Speaking on the gesture, the Access Bank’s Head of Sustainability, Victor-Laniyan, said: “The fact is that in every environment we operate, we must make the people better, the environment better while trying to drive profit. So, we are not just focused on making money – it is just one aspect of the things we are keen on. So, if you listen to Access Bank, some of the things we talk about is based on how we have brought sustainability and governance into how business is done within the financial market.”

    According to the CBN and NDIC, sustainability reporting allows organisations measure, understand and communicate their environmental, social and governance performances.

    Although the reporting system has gained currency and acceptance globally, only a few local banks and organisations encourage sustainability practices in their reports.

    To further involve corporate organisations, the CBN Governor, Godwin Emefiele and the NDIC Managing Director, Umaru Ibrahim said the regulators will continue to renew its commitment towards the implementation of the NSBP, the achievements of the United Nation’s Sustainable Development Goals (SDGs) and the Paris Climate Change Agreement.

  • Sterling Bank: Touching lives through non-interest banking

    Sterling Bank Plc is empowering people at the lower cadre of the economy by offering non-interest banking services to them. Group Head, Non-Interest Banking, Sterling Bank Plc, Basheer Oshodi, speaks with COLLINS NWEZE on how non-interest banking is changing the lives of people positively and why more awareness is needed to get more people into the financial services net.

    Once again congratulations on Sterling Bank’s successful hosting of the Non-Interest banking programme in Kano State. What is really driving the bank’s interest in this segment of banking?

    What we observed in this part of the world is economic growth without development. We found out that there is Gross Domestic Product (GDP) growth with increased poverty and unemployment thus there is no relationship between these indicators and better lives for Nigerians. So, poverty is still increasing, it has increased much more from the 1980s to this time. It has even increased much more from 1999 since the advent of stable democracy with unemployment also increasing. Depending on where you are getting your figures from, there are almost 50 million adults without jobs or defined source of income.

    Since unemployment is extremely high, we thought that apart from making profit as a business, which could somewhat be achieved easily, it is important to touch the lives of those at the bottom of the pyramid. Yes, we need to give those facilities; such facilities need to be cheap meaning the cost of fund needs to be low. We must also be able to guide them towards accessing market while the conditions of the debt are friendly.

    What are the important gains people can take away from non-interest banking?

    Access to fund is one thing, reduction in the cost of fund is another and then access to market also becomes very important. Now we thought why can’t we encourage entrepreneurs and High Net-worth Individuals (HNIs) and institutions to give us termed deposits?

    Most depositors like to have profit on their deposits. There are, however, others that are willing to leave their funds in current account for a defined term of one year, two years or three years provided such funds are given to those doing micro and small businesses. These businesses constitute 98 per cent of all businesses in Nigeria. In Non-Interest banking, we typically do not give out loans except under a qard-hassan (interest-free loan) for social solidarity or very micro businesses. We are basically engaged in partnership transactions, buying and selling at a markup price, and buying and leasing. That then means that markup price at every point in time is lower than 10 per cent. So, if somebody wants a generator to run her pure water business for example, we will simply buy her a generator and sell-back at a mark-up price of 9.75% per annum, she will only bring 10 per cent security deposit and two personal guarantors.

    Are there collaterals for such facilities?

    We only accept guarantors for our micro mark-up facilities, which is a maximum of N2 million. Those that want such facilities may even use their personal names rather than a business name and so the cost of doing business is reduced drastically and the cost of fund also is reduced, the deposit that he/she puts on the table is reduced, and the issue of collateral does not arise except the two personal guarantors. When we get funds cheap or at zero cost for a rather long term, and we give it out through ‘partnership’, ‘buying and selling’ or ‘buying and leasing’ mode of finance’, then, we can begin to see social impact or lives being positively touched in good time.

    We want to deal with cooperatives in large numbers since we already have funds from some foundations and high net worth individuals. We have since started to disburse while encouraging middle income earners to also contribute as little as N50,000 for one year or two years and add to the pool to funds we extend to the bottom segment.

    Of course, this means that unemployment will start to reduce with this approach that promotes self-employment. The truth in today’s Nigeria is that a lot of people cannot be employed, but can start to do their own thing. Only 0.5 per cent of Nigerian companies are large and with our massive population growth, it is unrealistic to employ the over 50 million adult population looking for jobs. With our micro mark-up facility, household incomes can start to increase, and multi-dimensional poverty can reduce. Parents can send their children to better schools, they can have access to better health facilities in the absence of national health insurance schemes and can afford to pay their rent.

    So, the idea of the programme is to be able to achieve what we call the primary purpose of non-interest finance which is to impact lives positively, make sure communities are happy and ensure that individuals are pleased. We call this communal well-being and having a good-life. As a bank, compliance with non-interest principles is most essential, followed by achieving profitability. The next most important thing being impacting lives.

    You talked about funds coming in from where you can now give out to beneficiaries that will contribute 10 per cent. You mentioned that the funds come from HNIs. But at what cost to you?

    It is basically at zero cost.  It is just like having current account, a regular current account means that the owner of the money can go to the bank anytime and collect it so I can put in N1 million in the bank today and pick it up tomorrow or next week. So, the idea now is for a lot of people to put that money in current account, but the money will have to stay for one or two or three years. Thus, the cost is almost zero.

    It is only where you have money at zero cost that you can give out money far below industry price. Don’t forget that inflation rate is 14.3 per cent, don’t forget that Monetary Policy Rate (MPR) is 14 per cent so banks will ordinarily trade at a price much higher than that.

    Are those people putting funds there aware that they are supporting non-interest banking?

    In Non-Interest Banking, the underlying contracts are defined. I am putting down this money into a qard (interest-free loan) deposit and it is for one, two or three years, that is the definition of the contract. The other part of it is that the bank should use it for micro facilities. So, the contract is clearly stated out. However, it doesn’t mean that if you want to take your  money at any time we wouldn’t give you.  When you want to redeem it, all you must do is to tell the bank I want my money back.

    I want to know if the people putting down such funds are supposed to share from whatever the business does, or they are just doing it for humanitarian sake?

    The first N100 million into this fund came in through a foundation while many of our corporate customers have also started to deposit into the fund. Now we have started to fragment it further such that individuals can also take part. The benefit is somewhat spiritual. From theoretical integral finance model, we refer to this as ‘sanctuary’ with unseen and immeasurable benefit.

    How much is in this pool of funds as we speak now?

    Beyond the exact figures, it can never be sufficient. In Nigeria we have 70 per cent of our population living below the poverty level whichever way you measure poverty. There are about five major ways of measuring poverty and it shows that Nigerians are very poor. So, even if you have a trillion dollars the problem is yet to be fully solved. What is important is to sustain that model and ensure that it consistently grows.

    Also, we want to see how we can get additional funds through retail banking. We need groups, associations and cooperative to believe in this and support such initiative.

    Can you name some of the foundations where the funds come from or international bodies that are involved?

    Basically, the funds we have now are from local foundations, corporates and individuals. They may not be popular names that you see everywhere. They only seek for the spiritual benefits.

    How do you feel, when you see the businesses that are supported with the funds thriving. What joy does it give you and how much of that have you achieved?

    From my experience, most people that take micro facilities do not default. Even where for some reasons, a business is not doing very well, and they are unable to pay in a particular month, they are usually able and willing to pay in the following month or immediately funds are received from their business. Occasionally, we give them extension which does not change the profit we charged at inception. The benefit is that we are not putting them under pressure, and they are able to expand their businesses. In Nigeria, and the bulk of Sub-Saharan Africa, assuming you have up to 100 businesses, about 90 of them are macro, another eight are small. So, 98 per cent of what we have in African countries including Nigeria are very small and micro businesses. It may be challenging to take them away from that segment, but helping them sustain their life-style would be fair.

    What do you think the regulators in this segment of the market should do to attract more interest in this type of banking because of the benefits that you have listed?

    The countries that were listed as third world countries 40-50 years have suddenly emerged as industrialised nations. What really helped them was some sort of equity injections into industries. What we have in this part of the world is debt-based intervention funds, thus the borrower will have to pay back usually within a year. But you know, debt and equity are not the same thing. Debt is usually short-term and can hardly serve certain part of industry. That means that certain industries will not grow. For countries that started doing very well in the last 40 years, like South Korea, Taiwan, Malaysia, and recently, Rwanda, you find out that there are special funds that were injected into industries because they are long term, they are patient and they allow gestation to take place. They acknowledge and accept incubation period. In the first one or two years, you may not make profits, but because the fund is equity there is no pressure to pay before breakeven.

    Don’t forget that Nigeria has the most Non-Interest finance regulation in Africa and the Middle-East. So, regulation wise, the regulators have done perfectly well. The infrastructural regulatory platform is already there. I am in support of long-term debts or equity and I am also in support of tying such debts or equity to specific projects so that funds are not unnecessarily mismatched.

    Now, we saw the oversubscription witnessed in the N100 billion Sukuk raised by the Federal Government. Does it in any way show the level of confidence people have in this type of banking?

    More than 90 per cent of institutions that bought into the Sukuk are conventional financial institutions. That is because it is guaranteed and the return/coupon is fixed. It adds to financial institutions liquidity ratio. If another Sukuk comes out now it would still be absorbed quickly. It shows that the market has matured much earlier than envisaged. People are just waiting for the opportunity to come in.

    What are the challenges you think should be tackled to take Non-Interest banking to where it should be?

    Like any other sector, it is affected by the overall economic performance of the country. So, the first challenge is that if an Islamic Bank has N1 trillion in its books as deposit, it cannot buy T-Bills or bonds because they are interest-based. The bank would also not be able to invest in other interest-bearing securities and deposits except in compliant instruments like Sukuk. It then means we need to have a lot of such that would create that opportunity on one hand. On the other hand, financial institutions can also be innovative enough and be able to come up with products that will absorb the excess funds so that such funds are not left idle. The only challenge left is in awareness. In fact, those that are banked are more aware than those that are unbanked. Those that are largely unbanked are less aware. In Nigeria, the Northwest and Northeast and more financially excluded than the remaining regions. This means the people need a lot more awareness and the expectation will be Non-Interest banking will attract them to banking.

    What is Sterling Bank taking away from this type of banking?

    We simply want to bring innovation and flavour to the banking system while impacting communities.

  • Touching Lives entries still on, says Airtel

    Touching Lives entries still on, says Airtel

    Two weeks after the launch of Touching Lives Season 2, leading telecoms operator, Airtel Nigeria, has said entry is still open for well-meaning Nigerians to nominate beneficiaries in the revolutionary CSR intervention, until August 27 when entries will close.

    During the launch of the  programme in Lagos, the telecoms company said entries can be submitted via SMS, phone calls to the short code 947 or via emails to:  touchinglives@ng.airtel.com.

    It also noted that nomination letters not more than 1000 words can also be submitted at Airtel showrooms, shops and dealers outlets across the country, adding that interested people can also go to Airtel Facebook page and Airtel CSR/Touching Lives web page for further information.

    According to Airtel Nigeria, disadvantaged persons, groups or communities in any part of the country who need help can be nominated by Nigerians while call for entry lasts.

    Its Managing Director and Chief Executive Officer of Airtel Nigeria, Mr. Segun Ogunsanya, said the telco rolled out the second edition of the revolutionary programme based on the monumental successes recorded with the first edition.

    According to him, Airtel went the length and breadth of the country, last year, scouting for people who needed help and for causes to support, noting that “the journey yielded great results as we touched the lives of many Nigerians.

    He also noted that the Airtel Touching Lives initiative marks a significant milestone in the company’s history of CSR interventions just as it perfectly aligns with the telco’s vision of connecting Nigerians to their dreams, enriching lives, uplifting people and creating prosperity for the people and communities we serve.

    “At Airtel, we believe that for us to be a great company we must be a good company and we are very much committed to earning our social license – the love and acceptance of the people we serve, “he said.

    Airtel Touching Lives Season One featured 26 emotion-evoking stories, which brought to limelight the commitment and kind-heartedness of Airtel in uplifting the conditions of underprivileged people across the Nigerian society.

  • Airtel unveils Touching Lives Season 2

    Airtel has announced the commencement of the second edition of the initiative, which has been described by many as a ground-breaking approach to Corporate Social Investment.

    The initiative is focused on empowering, uplifting and creating life-changing opportunities for underprivileged individuals, communities and groups in the Nigerian society.

    Speaking in Ikoyi, Lagos, to mark the commencement of the second edition, its Managing Director and Chief Executive Officer, Mr. Segun Ogunsanya, said the telco is rolling out the second edition of the programme based on the monumental successes recorded with the first edition.

    According to him, Airtel went the length and breadth of the country, last year, scouting for people who needed help and for causes to support, noting that “the journey yielded great results as we touched the lives of many Nigerians.

    He also noted that the initiative marks a significant milestone in the company’s history of CSR interventions just as it perfectly aligns with the telco’s vision of connecting Nigerians to their dreams, enriching lives, uplifting people and creating prosperity for the people and communities we serve.

    “At Airtel, we believe that for us to be a great company we must be a good company and we are very much committed to earning our social license – the love and acceptance of the people we serve, “he said.

    The Season One of the Airtel Touching Lives featured 26 emotion-evoking stories, which brought to limelight the commitment and kind-heartedness of Airtel in uplifting the conditions of underprivileged people across the Nigerian society.

    The initiative is structured in a unique fashion that allows Nigerians to nominate disadvantaged persons who are in need of care or special interventions. Entries can be sent in via SMS, phone calls to the short code 947 or via email to:  touchinglives@ng.airtel.com.

    Also, nomination letters not more than 1000 words can also be submitted at Airtel Showrooms, shops and dealers’ outlets nationwide. Interested people can also go to Airtel Facebook page and Airtel CSR/Touching Lives web page for further information.

     

  • 110 years of touching lives

    110 years of touching lives

    The Rotary Club International has celebrated its 110th anniversary. Last Sunday, the District 9110 marked the milestone in Lagos, reports EVERISTUS ONWUZURIKE. 

    All roads led to the Indian Temple compound in Palmgrove Estate, Lagos last Sunday for the 110th anniversary of the Rotary Club International. For over a century, the club has been on top of its game,  improving the lives of people in its locality.

    The event was held in an open ground in the estate. The trees dotting the field  made the environment cool and breezy. Members of the club were joined by visiting Rotarians; friends, and members of the society of Indian clubs, Oriya Samaj of Nigeria (OSAN) and Bhojpuri Pariwar, Nigeria graced the occasion. To this end, the club is targetting the prevention of anaemia and the donation of 100 bottles of blood.

    Many turned up to donate blood. Beds were on the field for the donors.

    The name Rotary, members said, came from the group’s early practice of rotating  meetings.

    The President of Rotary Club, Palmgrove  Ramesh Biswal, said the club, which started in 2008 with 23 members,  now has about 70 members.

    He said the club has helped many, adding that it donated artificial limb to someone in association with Hindu Mandir Foundation.

    “We have also been able to do free eye surgery, free medical check-up, and given communities drugs to eradicate polio,” he said.

    Biswal added that its commitment to service is ongoing. He further thanked everyone for participating in the years of dedicated service to humanity by bridging gap in the continents, which is enabling all to light up rotary and then become a gift to the world.

    In an address, he said the objective of the blood donation project is to save lives and prevent disease, such as Anaemia, high blood pressure, HIV, diabetic and this, adding that it would be achieved by sensitising the public on the need to donate blood that will one day save lives.

    The event featured free medical checkups for the participants and guests.

    District Governor, 9110, which comprises Lagos and Ogun states, Dr Dele Balogun said, the club began the fight against polio in 1979 with a project to immunize six million children in the Philippines. According to him by 2012, only three countries remain polio endemic down from 125 in 1988.

    The club berthed in Nigeria in 1961 when the first rotary club in Nigeria was chartered in Kano on April 28,1961 in the 56th year of Rotary, the Rotary club of Lagos was founded on May 30, 1961 while that of Ibadan was chartered on November 24, 1961.

    The high point of the event was the cutting of the anniversary cake as the club members, wined, dined and danced.