SystemSpecs expanding the frontiers of financial inclusion in Nigeria – Atanda

Deremi Atanda, executive director at SystemSpecs, Nigerian indigenous software giants, has said that the company is introducing services that will leverage technology to accelerate the rate of financial inclusion and aid the growth of Nigeria’s economy.

Financial inclusion is the quest to make financial services accessible at affordable costs to every individual regardless of net worth, and business irrespective of the size, with the aim of addressing and proffering solutions to the restrictions that keep people from participating in the financial sector.
According to the World Bank, financial inclusion is a key enabler to reducing poverty and boosting prosperity. Close to 2 billion people do not use formal financial services and more than 50 per cent of adults in the poorest households are unbanked, the Bank said on its website.

 

 

NIGERIA’S FINANCIAL INCLUSION DATA FOR AGE 15+ AS AT 2015 (%)
	Nigeria	Sub-Saharan Africa	Lower Middle Income
Account
All adults	44.4	34.2	42.7
Women	34	29.9	36.3
Adults belonging to the poorest 40%	34.4	24.6	33.2
Young adults ages 15–24)	35.7	25.9	34.7
Adults living in rural areas	39.4	29.2	40
Financial Institution Account
All adults	44.2	28.9	41.8
All adults, 2011	29.7	23.9	28.7
Mobile Account
All adults	2.3	11.5	2.5
Access to Financial Institution Account
Has debit card	35.6	17.9	21.2
Has debit card, 2011	18.6	15	10.1
ATM is the main mode of withdrawal (% with an account)	70.5	53.8	42.4
ATM is the main mode of withdrawal (% with an account), 2011	40.8	51.7	28.1
Use of Account in the Past Year
Used an account to receive wages	8.8	7.3	5.6
Used an account to receive government transfers	3	3.8	3.3
Used a financial institution account to pay utility bills	5.2	2.8	3.1
Other Digital Payments in the Past Year
Used a debit card to make payments	14.1	8.7	9.6
Used a credit card to make payments	1.9	1.9	2.8
Used the Internet to pay bills or make purchases	3.3	2.4	2.6
Savings in the Past Year
Saved at a financial institution	27.1	15.9	14.8
Saved at a financial institution, 2011	23.6	14.3	11.1
Saved using a savings club or person outside the family	23	23.9	12.4
Saved any money	69	59.6	45.6
Saved for old age	16.3	9.8	12.6
Saved for a farm or business	31.7	22.7	11.8
Saved for education or school fees	32.5	22.9	20

Source: World Bank

 

The BusinessDay Fintech Summit, which theme was ‘Harnessing the power of disruptive innovation in FINTECH’, assembled key stakeholders in Nigeria’s Fintech ecosystem to discuss how to exploit the opportunities and overcome the obstacles inherent in the adoption of Fintech in the country.

 

Regulators, bankers, Fintech heavyweights and thought leaders spoke on the imperatives for collaboration in the Fintech ecosystem, the need for building knowledge and infrastructure capacity within the sector, and the impact of regulation on fintech adoption.

 

Atanda said that information obtained from the national identity card scheme could be used to develop products that will help bring other financial services to increased number of people, beyond just payments.

 

“So those are the things we think we are doing to encourage financial inclusion and deepen it within the national payment vision timelines,” he said.

 

With little access to banks, especially in rural in Nigeria, under-banked users mostly carry out transactions in cash or checks making them vulnerable to theft and street frauds.

Access to bank locations for conducting transactions like cash deposit, check cashing, money order, and funds transfer usually come at high costs in terms of banking fees.

Even some of the services that are being deployed to bring more people into the financial system presently come at a high cost to the poor people, and will eventually be counterproductive to the goal of financial inclusion.

 

This is not sustainable because if the cost of providing the services is high, then we cannot succeed in our efforts to bring financial services to the poor, said Deji Olowe, executive director, SystemSpecs.

 

“There is a correlation between networth and financial inclusion,” Olowe told BusinessDay. “Cost of providing services to the financial excluded is presently high. How do you expect a housemaid earning about N5,000 a month to pay N100 as transaction charge?”

 

Olowe said that the solution is to bring the financially excluded technology that will ensure that they are integrated into the financial system without digging a hole on the floor of their financial wellbeing, an initiative that SystemSpecs in presently pursuing using the platform of Fintech.